Subsidiary Ledgers & Special Journals | Robert Steele | Skillshare

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Subsidiary Ledgers & Special Journals

teacher avatar Robert Steele

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Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Watch this class and thousands more

Get unlimited access to every class
Taught by industry leaders & working professionals
Topics include illustration, design, photography, and more

Lessons in This Class

11 Lessons (3h 6m)
    • 1. Introduction

      0:40
    • 2. 10 700.10 Accounts Receivable Subsidiary Ledger 700 Part 1-Accounting instructions- (1)

      12:31
    • 3. 20 700.20 Accounts Receivable Subsidiary Ledger 700 Part 2-Accounting instructions

      11:58
    • 4. 30 700.30 Accounts payable subsidiary ledger 700 part 1-Accounting%2C Financial

      12:31
    • 5. 40 700.10 Accounts payable subsidiary ledger 700 part 2-Accounting%2C Financial

      13:35
    • 6. 50 Worksheet Sales Journal

      19:13
    • 7. 60 Worksheet Sales Journal Inventory

      17:16
    • 8. 70 Worksheet Purchases Journal

      23:02
    • 9. 80 Worksheet Purchases Journal Inventory

      13:38
    • 10. 90 Worksheet Cash Receipts Journal

      33:51
    • 11. 100 Worksheet Cash Payment Journal

      27:39
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About This Class

In this accounting project-based course we will learn how to use subsidiary ledgers related to accounts receivable and accounts payable. We will also learn to account using special journals.

We will provide Excel worksheets with at least two tabs, one having the completed work, the other having a preformatted Excel worksheet where you can enter data along with step by step instructional videos.

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Transcripts

1. Introduction: subsidiary. Ledgers and special journals will be a project based course where we will learn about subsidiary ledgers through practice problems, including accounts receivable, subsidiary ledgers and accounts payable subsidiary ledgers. We will also learn how to use special generals and set up an accounting system with the use of special journals. We will have Excel sheets down below so he could download the Excel sheets. The Extell sheets, each having at least two tabs, went tap with the answer to it. The other tab having a pre formatted worksheet, which will look something like this that you can fill in along with a step by step instructional video. 2. 10 700.10 Accounts Receivable Subsidiary Ledger 700 Part 1-Accounting instructions- (1): So when this lecture, we will work on journal izing transactions right here. We're gonna journal eyes those transactions here and then we're gonna post them to three different places. One being the quick post to the trial balance in this entries section so we can see the activity in a quick and easy way and see what the effect is on the child balance. Then we're also gonna post it to the subsidiary Ledger. So these are going to affect accounts receivable. Much of the time and accounts receivable is representing what is owed to us. And therefore, we also need to know who owes us the money. So we're going to start recording that to the subsidiary Ledger, which will be in order by client or customer in this case, and then we're also going to record it to the General Ledger. So we want to see all of the type of activity that would happen when we're recording these transactions focusing on the accounts receivable cycle. So we're going to see the quick reaction here to the trial balance of directly. Analyze that, then recognize the fact that we do want to sort this by customer in this case beak, And that would be done through the accounts receivable subsidiary Ledger. And then, of course, we have the General Ledger and we're only including the General ledger here for the accounts receivable account. So we're not gonna record every General Ledger account. Of course, every other account here would have a General ledger account, but we're focusing in on accounts receivable and therefore, we're just gonna record the general rhetoric out for receivable to distinction, to have a distinction between that and the subsidiary Ledger here. So, of course, we have our trial balance right here, and that's gonna have our assets. They're gonna be in green. We've got our yellow or orange are liabilities the equity account in the light blue. And then we got the revenue and the expenses on the bottom. We know that we are in balance because the debits minus the credits equals zero, and we're gonna post our activity here. We also concede that net income is here. This is actually income, not a loss, because it's the revenue of less the expenses. And there we have the income here. And then, of course, we have our accounting equation up here with the assets of the green ones and then the liabilities. I noticed there's no negative sign here because we flip the sign. And then all of this is the equity one of their nasty equity. All right, so now it's record. These out of the 1st 1 says, perform work on account and invoice the client and the client Smith in this case. So we got 35,000. We did work. We invoice the client. So is cash affected in this case? No, because we did the work on account and we sent out an invoice. Did not yet get the cash. Therefore, we did get something. We got an IOU that I are you being accounts receivable. So we're gonna say accounts receivables, what we have received in this transaction and that is an asset accounts just in under. Cash and assets have debit balances that we need to make it go up. How do we make something go up? We do the same thing to it as what it is, which in this case, would be another debit. So I'm gonna debit the accounts, even gonna copy that wreck. Click copy One to copy. And they're gonna put my cursor in C five and then right, click and paste it. 123 So we're pacing just the values, not the formulas. Just values here will keep the cells looking like they are in that blue color. And we're gonna put the amount 35,000. Every debit is gonna have unequal number of credits for every transactions were gonna have at least two accounts. So we're gonna have a credit here. We will be representing the credits with negative numbers or bracketed numbers in the Excel worksheet. We're gonna talk negative 35,000 and I'm gonna hit intern. Of course, it'll format that cell for us with brackets because of the formatting of the worksheet. Then we just need to know what this US account should be. And why are people gonna pay 35,000? Because we did work and earned revenue, and we could call this depending on the type of company revenue. We could call it incomes. We could call it sails. We could call it fees earned. It just depends on the type of company, but it is going to be a revenue tap account, and of course it will be down here in the revenue area mean it's under the capital section on the trial balance. Gonna copy that? Right click. Copy that. We're gonna pace that on the bottom Credits traditionally, go on the buttons. We are in cell C six, right Click and paste. 123 So I'm gonna post this now to basically three different places. I'm gonna post it here to the trial bounce. We could see a quick, easy beginning and end trial balance. Vendrell posted to the subsidiary Ledger at least the receivable side of it. And then we will post a receivable site of it to the General Ledger. So let's do that. Now. We're gonna say the receivable is here. So here's the receivable. Its second account. So we are in I six and say equals. And then we're gonna point to that 35,000. What's gonna happen will go up here. We will go out of balance by the 35,000. So the 35 represents that customers over 35 now we are out of balance by 35. We will then post of a revenue in I 14. So are 14 equals are gonna point to that 35,000 credit. What will happen? The credit will go up in the credit direction because we're doing the same thing to it will be back in balance. Net incomes going to go up from the transaction. So we're recording revenue. Revenue is being recorded when we did the work. Not necessarily when we get the money cause we haven't got any money yet. So now we're gonna record that same accounts receivable to the subsidiary Ledger here, so we need to record it by customer. Why? Because often times when we look at the track pounds, we're gonna say who owes us money or how much do people always people always. 35,000. The next question we're gonna have is, Well, when are we going to get that money? And who owes it to us? Lets call those people. And to do that, we're gonna need to know the subsidiary Ledger by the accounts receivable by customer using the subsidiary Ledger. So here we have Smith. We're just gonna record that same debit side. Teoh this account here in the subsidiary bedrooms gonna say equals and that's gonna point to that 35,000 again. Now treat it. Also, we're gonna have this stuff in the general ledgers. I'm not gonna post the entire general ledger out, but just to recognize that there is a difference. We're talking about something different in the subsidiary leisure than what we have seen in the General Ledger. The General Ledger would be posting transactions in order Ah, by date or the order of the transaction so we can post the same thing in the a r. Sum city, General Ledger. So we could say that this equals that same 35,000 and we see that the 35,000 in this section is gonna be the same information that will re recorded here. It's just that it will be recorded slightly differently right here. It's only recorded by date right here. It's recorded by customer. And, of course, the end of it. We have to 35 here. 35 is what's adds up all the customers that times out to the trial balance. All right, next transaction. We're gonna scroll over here, and we're gonna say that received a cash on account from Client Smith for work performed in the past. So now Smith paid us this 35,000. But that would be the natural transaction. That would happen. Hopefully, sometime in the future, we get a check in the mail. Therefore we're gonna ask her questions. Is cash affected? Yeah. We received money. We got cash. Cash has a debit balance. We need to make it go up. How do we make something go up? We do the same thing to it, Which in this case, would be another debit. So I'm gonna copy the cash. We're gonna put that in cell C 87 right click and put that in C eight. And how much did we receive? 35,000. Because that's that's what we build them for. 35,000. And so we're gonna credit the same amount, so there's gonna be equal number of debits and credits and they're going to say Well and why did they pay of 35,000? Because we did work. But we did work in the past, so we're not gonna credit the receivable account. We already did the work in the past. They owe us. Of course, the 35,000 that we put right in the receivable. Now they paid us that they no longer Oh, is that better for that 35,000 debit there needs to go down. How do we make something go down? We do the opposite thing to it as what it is. That's a debit. Therefore, we need to credit it to make it go down. We already knew that because we debited cash. So that's where the credits gonna go. It's gonna make it receivable. Go back down to zero. I'm gonna copy that. Gonna paste it in C nine, right Click and paste. 123 Values Onley in C nine. Recognize what is happening here? We're just getting a better asset. Cash and we're losing the worst or asset. The accounts receivable know that may not be a word, but it sounds good. So they've received was going down. Cash is going up and no effect on revenue for this transaction. So it's posted out and see what happens. We're gonna go up here to I five. I five equals we're gonna point to that 35,000. What's gonna happen? Cash will go up by 35,000 cause the debit debit makes a debt go up in the debit direction Teoh. 60 3000 then accounts receivable. There's something in it here. I could see it in the form of the bar. Of course, D five is in there. That's the D five here. In order to post to it, I'm gonna double click on it, go to the end of it and say, Plus, and then point to this 35,000 here and now we see there's two things in there. There's a 35 debit, the 35 credit, one positive one negative ones of debit wants a credit that's gonna make it go down to zero again. So even though we have a zero there, we can see what's in there. And I like to use these icons. Point to them and we could see Okay, that makes sense. It went up and went down. And if you want to know where those icons are, they are in the formulas tab and there in the form of this auditing. And here they are here so that I could turn them off with this thing here. All right, so we're gonna also post those out to the subsidiary Ledger. And so we're going to say no one owes us any money right now. Therefore, we have to reflect that in the subsidiary Ledger, meaning Smith doesn't always any money anymore. So we're gonna put that same activity in M 10. So this equals the 35,000. And that means Smith no longer owes us that this would be the normal activity with enough receivable account. Of course it goes up and then hopefully they pay us. It goes down, we invoice them. We got to check in the mail. That's what should it should look like if we just look at that in the General Ledger will post the same activity. The General ledger again. We're not gonna post all the accounts. Of course, to the General Ledger, we would be posting both the General Ledger, cash and receivable. In real life, we're doing the full problem. But we're just looking at the receiver, the accounts receivable, G l account General Ledger account, and we are in the credit side. So we can say this equals that same credits, the same activity by date. So we don't know who, necessarily by this 35 by this General Ledger account, but we could see that it went up when I went down to probably a safe bet that that's the same client and it may not be, of course, right next to each other in this activity. We could have other sales involved, but that's the type of activity we expect to see in the receivable account much of the time . So now, of course, we have zero here. The subsidy ledger adds up to zero, and that's what's on the trial balance as well. Next one perform work on account and invoice declined. Adams. All right, so we're gonna do work on account. So is cash affected Where we did work on account is cash affected and answered? No, because we did. It was on account and we issued an invoice. When we issue an invoice, that's because we did work, and therefore we earned revenue and we have received We believe we ve seat the intangible asset of an IOU called accounts receivable. So accounts receivables and asset has a debit balance just like cash. It needs to go up because people always more money. How do we make it go up? We do the same thing to it, which in this case would be another debit. So we're gonna copy of receivable and right click. Copy that. Gonna put that in C 11 right? Click and paste it. 123 The amount being 4 14,000 in this case, if we debit something. 3. 20 700.20 Accounts Receivable Subsidiary Ledger 700 Part 2-Accounting instructions: seven, right click and paste it. 123 The amount being 4 14,000 In this case, if we debit something, 14,000 barrels are gonna credit something. 14,000. So I'm gonna go and sell E 12 Negative for the credit for this worksheet. 12,000 no Commons or anything pushed. Enter and that will form at the cell with the brackets. And then we just need to know what that account should be Here. And of course, why are people gonna pay us 12,000? 14,000 should be negative. 14,000. So why are people gonna pay us 14,000 in the future? Because we did work and earned revenue or income or sales. Depending on what we do, we can call it whatever we want. But it's in the revenue section, and it's gonna be a revenue type account, meaning it has a credit balance, and revenue accounts generally only go up. So how we're gonna make it go up, we're going to the same thing to it. Which, of course, is another credit. So we're gonna credit the revenue account. We always credit revenue only gets credited. So I'm gonna copy that. Gonna put that on the bottom in C 12 right click and paste it 123 So then let's post this out again when I posted to our three locations. So it's first posted to our trial balance. So we're gonna go into the receivable. There's a zero in it. So we don't want to delete the zero, even though it zero, because I know there's two things in it. There's D five plus e nine and I'm gonna double click on it, go to the end of it. And so and then go plus and point to the new receivable 14. That what? We can see the activity in there when we hit. Enter week goes up by 14 takes us out of balance by 14. We can then see the activity that is in there like so And then we're gonna post the other side to the revenue once against something in it. East. The E six is in it, so we can double click on it, go to the end of it and then say plus and point to the revenue the credit of the 14. What's gonna happen? It's gonna take revenue up. Ah, by the 14 put his back in balance. So revenue, which is the credit minus the debits, is now went up to 1 37 8 55 All right, so now I'm gonna post the same thing out to the receivable accounts. This was Adam's down here. So we're gonna be down here in the receivables in the debit side. I'm gonna post this same activity out. Say Adam owes us money. So now we can answer the question. If we say who owes this money? How much? Two people with 14,000 says on the try bounce. Who was this? 14,000. Well, we have to look at the subsidiary Ledger, and we could see now that Adam's is the one that poses the 14,000. We also will have that activity by date on the G l for all accounts. So on the G l we can put that same activity would look like this for the receivable equals of the 14,000 and enter. And now, of course, the receivables in the General Ledger tied out to the receivable on the subsidiary Ledger ties out to the receivables on the trial balance. So all that activity is there and once can note that we would have a receivable account for all the trial balance. I mean, a General ledger account for all the trial balance accounts as well. All right, so let's see what the next one is. We got deep performed work on account and invoice declined. Ryan. So same activity. We did work, and we invoice the client. So is cash affected? No. We invoice the client. We haven't got cash it, but we did the work. And therefore, people always money in the account that people owe us. Money is represented by the accounts receivable account. It has a debit balance represented by the fact that it has no brackets in the number. And we need to make it go up because people always more money. How do we make it go up? We do the same thing to it, Which in this case, would be another debit. I'm gonna copy this one. Gonna put that on top again? The amount being 27 1000. If we debit something, we're also going to credit. Something's gonna put a negative 27,000 in e 15 and enter. That'll put brackets around it, then what should that account be well, why are people gonna pay us 27,000? Because we did work and therefore earned revenue again. So we earned revenue. We could see that revenue has a credit balance. Revenue on Lee goes up. We're gonna make it go up again by doing the same thing to it, which in this case, would be another credit, which we already knew because we debited the receivable. So there's the credit we're gonna credit to. And so let's copy that and put that in the credit side of our journal entry. All right, so it's post this out. And, of course, that two accounts were focusing on are having a lot of activity in them. But let's post that out again. We got 14,000 here. If we double click on it, we can see what is in there. So of course, this is what's in there. And now we're gonna go to the end of it after the d 11 and say plus and point to the 27,000 which, of course, will make the receivable go up again by 27,000 put us out of balance down here, and then we're gonna post the other side of it. Teoh the receivable. Double clicking on the receivable. Go to the end of it and plus And then, point, Teoh, the revenues are the other side of it is revenue. And the revenue, of course, will go up in the credit direction, bringing net income up and putting us back in balance here. So there we have that We're gonna post this out once again to our subsidiary Leger. We can see your question. Who? How much do people OS 41,000? Well, who is this? 41,000. Well, then we're gonna go. There are subsidiary Ledger over here and say, Well, Adam owes us, and then we have ah Ryan, who we need to record over here in p nine soapy nine, we're going to say equals that same 27,000 needs to be recorded there, and now we have the 2027 by Ryan and the total adds up to, of course, the 41 which is on the trial balance. We will also have this activity by date on the General Ledger. Not as useful in this particular type of account, which is why we need the extra ledger of the subsidiary Ledger by client. But the activity for all accounts will be represented in the chip General Ledger by date. So we're gonna go by date. We're gonna be in cell T 12 t 12 equals the same activities. I'm just gonna post that same debit bringing this 14 up in the debit direction because the same thing makes it go up. And there we have that. Let's take a look at the last one here. Going to receive cash on account from Adam's. So now Adam's gonna pay this this, 14 that we build them in the past. That's what we expect to happen. We invoice them, and then we received a check in the mail that West. That's nice. So then we are going to say, Well, is cash affected? Yes. Caches affected. We just got the cheque. Cash is gonna go up. Cash has a debit balance. We make something go up by doing the same thing to it. In this case, that would be another debit. A debit and a debit are the same thing. Making the debit go up copying that right clicking, pasting one. Do three. So that's gonna be the 14,000. Then we're gonna credit something. Of course. 14,000. I'm going to represent the credit with a negative for this worksheet. 14,000. And then we just need to know what account we're gonna credit. Well, why did people pay us 14,000? Because we did work and we did earn revenue. But we earned revenue in the past. And people already we already recorded that revenue up here. Now we need to see the fact that we also recorded up here, but receivable that represents the fact that people owe us money that now needs to go down because somebody paid us money that has a debit balance in it. And how do we make something go down? We do the opposite thing to it, Which in this case would be a credit. And we already knew that we're gonna credit because we debit cash. There's the credit right there that we will credit it for. So what is happening? Receivables will go down. We're losing one asset, but we're gaining. Ah, better asset of that asset being cash is gonna copy the receivable. We're post that underneath in Sief 18 right? Click and paste it 123 Okay, then we're gonna post this out. So that's posted this out. We're gonna post cash. Cash has something in it. Someone of double click on it. We're gonna go to the end of it and say Plus, and I could see what's in there, there, and I'm gonna put this 14 in there as well. What's that gonna do? Increase cash put. It's out of balance. So there we have that. Then we're going. Teoh, record the receivable. So here's the receivable in I six. Double clicking on I six going to the individual, getting kind of long, I see that. But we could see everything that's in there, and we're gonna go to the end, say, plus and then point to that 14,000 and then when we hit Enter what's gonna happen? The receivables gonna go down because it has a debit balance. It's gonna go down and puts it back in balance down here. So now we can see the receivable if we ask. Someone asked us if our boss assets before the owner and we're asking who else's money or how much do people s people always 27,000. Well, who is this 27,000. And of course, we're gonna have to look at the subsidiary Ledger for that. We need to record this same activity for Adam's down here is the one who paid us the 14,000 . So we're gonna go into the credit side. Four atoms and we are in cell and 17 equals and win a point to that 14,000 over here that will bring the 14 down a by 14 to zero. So Adams no longer owes its the money. We could see that that all of the subsidiary ledger accounts now add up to 27,000. Just what Ryan Noses Vap ties out to the tribe bounce. And of course, this information would be on the general ledger as well, and it would be recorded by date. So we need to record that as well in the General Ledger for accounts receivable. So I'm gonna say the same activity equals the 20 14,000 here, bringing the 47 down by the 14th to the 27. So the 27 in the geo ties out to 27 in the subsidiary Ledger ties out to the 27 in the trial balance also note that if we look at the g o, we can see that the activity being the fact that the same thing makes it go up the opposite thing makes it go down. So we see that we have the debit side here are always gonna win because it's an asset account and you could think of it kind of a race that we're saying who you know, it's the debits against the credits. Which ones they're gonna win. And how much are they gonna win by? Well, we already know the debit or is gonna win because it's an asset accounts. So therefore the credit makes it go down. So the 35 minus the credit makes it go down. Then we're gonna say, Plus, the debit makes it go back up to the 14. Then it plus the debit makes you go up to 47. And then we say, minus the credit, Mexico down to 27. Other way we can think about it is, of course, the debits add up to a total of 76,000 minus the credits, which add up to the 49,000. If you subtract those two outs, you get the 27,000. So that's how the activity will work in the G L. That same activity is a little bit more difficult to see in the subsidiary Ledger because it is course broken out in a bit more detail by customer. And, of course, we can see the summary of that same activity in the trial balance by just taking a look at what is being included here. So, debit, making it go up credit, making it go down debit, making it go up debit making, going up credit, making it go down. 4. 30 700.30 Accounts payable subsidiary ledger 700 part 1-Accounting%2C Financial: Hello. When this lecture, we're gonna be concentrating on posting transactions, concentrating on the account over accounts payable. And we will be recording the accounts payable here on the trial balance, as well as recording that in the Subsidiary Ledger as well as taking a look at what the general ledger would be four transactions affecting accounts payable. So, as we can see, the subsidiary Ledger is going to be broken out by vendor in this case, accounts payable, representing who we owe. We owe money to folks, those folks being vendors. And so we're just gonna have these three vendors in the set. And then we also see that the General Ledger is going to be an order by date. Every account, of course, have a general ledger account. However, we're just gonna look at the General Ledger account four accounts payable in order to compare and contrast it with the accounts payable account for the Subsidiary Ledger account here. So what we have on this worksheet is a trial bounce where we're gonna have the assets and green liabilities and orange and then the equity in the light blue and in the darker blue being the income statement revenue and expenses. We could see that we are in balanced by the fact that the debits which are gonna be represented with positive non bracket numbers minus two credits, are equal to zero. That's what this zero represents. Meaning we are in balance. We could see that net income is going to be the revenue. The credit minus the debit of 30 9000. That is revenue and not a loss. In this case, we're gonna post our activity here and end up with an Indian balance to give us a quick recap of the effect on the trial bounce accounts from these journal entries. We can also see that we have our adjusting or are balancing accounts up here as well in the form of assets, the green accounts equal liabilities plus equity. Okay, so let's see what we have over here. We're going to say we're gonna start off on 11 I'm gonna say purchase supplies on account from Office Depot. So going through our normal questions, we're gonna say it's cash affected. No, in this case, we purchased it on account. So that means that we have an IOU account. We owe someone money that account is called accounts payable now, accounts payable is a liability liabilities of credit balances. We probably haven't worked with credit balances as often as some other types of accounts. Therefore, it might be easier to think about what we have received first in order to determine whether we should debit or credit it, and that will help us out with which way we should go for the council payable. So let's think about the other half of the journal entry, which is we bought supplies. All right, so supplies we see up here, we have an asset for supplies. If we look at our trial balance and we're gonna record it doesn't ask it not an expense in this case, because we're gonna assume that's the supplies are large enough that they are material. We were going to record them as an asset, then count them at the end of the time period and then record the expense based on the count in terms of how much we have used. So right now, we're gonna buy it. It's an asset. Assets have debit balances. We got more of it. Therefore, we need to make it go up. How do we make something go up? We do the same thing to it, Which in this case, would be another debit. I'm gonna debit that. I'm gonna put my cursor in G seven right click and copy that account. VIN Precursor in C five. Right Click and paste it. 12 threes. We're gonna pace that there. Then the amount will be for 6 80 So 6 80 is the debit debits generally go on top. Then we're gonna have the credit. If we have only two accounts affected, then we have to have an equal number of deputy credits. So if we have a 6 80 debit, we have a 6 80 credit. I'm gonna represent the credit with a negative number here. It's gonna be a negative 680 So and then when we enter, it will form at the cell for us automatically Civil select, enter, puts brackets around cell and format it because of the formatting of the tribe via Excel account. Now we're gonna see what account we need to put down here. We already said what it was. It's accounts payable. Does it make sense that we would credit accounts payable accounts payable is a liability. Liabilities have credit balances. The bad thing needs to go up because we owe more money. How do we make something go up? We do the same thing to it. If this is a credit bounce account, the same thing would be another credit. So it doesn't make sense that we would credit it. Therefore, I'm gonna copy the accounts payable here. Right click and copy that Accounts and paste it on the bottom in cell C six, right. Clicking and pasting. 123 So just the values only. All right. Now we're gonna post this to three areas. The first of those three being the trial balance and want to post it into this middle area in the travelers to give a quick recap of what will happen from the beginning. Bounce to the Indian balance. Therefore, we're gonna find supplies first. So here's supplies. That's what unopposed were posted to. The supplies here were posted to the blue area, next to supplies in. So I seven. So with an I seven, we're gonna select equals and point to the 6 80 What's gonna happen when we hit? Enter The debit will go up in the debit direction because we're doing the same thing to it , and it should put us out of balance. So there it went up. Supplies goes up and we, of course, are out of balance. Now then, we're going to post this second half to accounts payable accounts, tables here, counts tables here on the trial balance. We're gonna be in the blue area next to accounts payable in I 10. So within I 10 we're gonna select equals and point to the 6 80 there. What's gonna happen when we post that the zero is gonna go up in the credit direction? 26 80 put it back in balance. Down here. Like so. All right, so then we have that. And now we're gonna post this to our to other locations. Why? Because the often the question is, with accounts payable is how much do we owe people answer. Trial balance says we owe people $680. Then the next question Who do we owe? Because And when do we owe it? Because we got to write a check to somebody. And in order to answer that question, we need to track it not by date, but by vendor that is the subsidiary Ledger. So we're gonna record this same information in the Subsidiary Ledger and in this case we are paying are bought stuff from Office Depot. Apparently, we're gonna pay them later. So we're gonna be in the same credit side. We're gonna have the credit side here in Office Depot's account equals, we're gonna point to that same 6 80 recording it again. And now we see that the total for all the vendors, the people that we owe adds up to 6 80 which ties out to the trial balance. Now, we're also going to record this on the General Ledger. Every account has a general ledger and the General Ledger is going to be in order by date of transaction. So we're just gonna compare the general ledger for the accounts payable, not showing the general ledger for all other accounts just so we can have some comparing and contrast in between the standard General Ledger and the added ledger that we need for an account like accounts payable being the subsidiary Ledger. So in the general ledger, it's just gonna be an order by date. We're just gonna record the same information in U nine equals that same 6 80 That's gonna make it go up to 6 80 so we could see that the General Ledger has 6 80 in it. The subsidiary Ledger has 6 80 in it. The trial balance has 6 80 And why do we need three of these things, too? Show us the information because the trial bounce gives us the amount we owe but doesn't tell us who we owe it to. The General Ledger gives it to us by date of when it happened, but doesn't tell us who we owe it to, necessarily. And the subsidiary letter does by breaking out who we owe by vendor. Okay, so then we're gonna go down here, and we're gonna say the next account was gonna be on to one. Words have paid off. Paid Office depot for purchase of office supplies. So we purchased it. Now we're paying it. So that means Is cash affected? Yeah, we paid with cash, So cash has a debit balance. We need to make it go down. We're gonna make it go down by doing the opposite thing to it. Which in this case would be a credit. I'm gonna copy the cash. Gonna put that on the bottom. So here's the date. I'm gonna be unlike the bottom of the date down here in C nine, right. Clicking and pasting. 123 Just the values on Lee. Then we're gonna go in the credit column. We're gonna represent the credit with a negative in this case, which will put brackets around it for our formatting in excel of 6 80 There we have it. If we credit something, we're also gonna debit something, and the debits generally go on top. So up here in cell D eight, we're gonna put in the positive 6 80 And then the only question is, what should this account be that we are going to debit? And why are we gonna pay someone money? Because we bought stuff, but we bought it in the past, and we already recorded the stuff we bought being the supplies here. And now we're paying off the bill that we owe represented by the IOU. The accounts payable to the accounts payable hasn't credit in it. We know that we're gonna debit it. Does that make sense? Yeah, well, accounts payable have the credit. We need to make it go down because we no longer Oh, it because we paid it. How do we make something go down? We do the opposite thing to it as what it is if it's a credit, the opposites of debit. Therefore, yes, it makes sense that we should debit it. So we're gonna copy that account. Gonna put that out on top in cell C eight, Right. Clicking and pasting. 123 All right, we're gonna record this to the three locations now, First of those locations being the trial balance. So we're gonna record the accounts payable. So here's the accounts payable. Here's the accounts payable. There's something in accounts payable in the blue area. What's in there? E six is in there. I don't want to delete that. I'm gonna double click on that, go to the end of it and then add to it. So I'm gonna put a plus sign here, adding to it and then post to the at 6 80 So we have a e six plus d eight and what's gonna happen when we hit Enter? It's gonna go down to zero because we don't know any money anymore, and then we're gonna post the cash. So we're up here in I sick. I five equals and then will point to the 6 84 cash. What's gonna happen? It's gonna go down and we'll go back and balance down here. So enter goes down. We're back in balance. All right, So now we're gonna post this same information to the subsidiary Ledger. We're going to go over to the subsidiary Ledger and Office Depot. We don't owe them any money anymore. Therefore, we're gonna go down to l 10. Here, in the debit side of office, people account in the subsidiary Ledger equals pointing to the 6 80 debit. And once we hit, enter that 6 80 credit will go down to zero. So now we have zero for all the vendors again, and we are back in balance on and it ties out to the trial balance. And this is what, Of course, a normal ledger account should look like we cracked up the bill. Then we pay it. We're going to rack up a bill, then we pay. That's what accounts table looks like. And if the same pattern, of course, will be in the General Ledger, which will be, by date only, not by vendor. So we're just gonna record this. Same information in T 10 equals this same activities 6 80 bringing the balance down to zero . So now the general ledger zero, this subsidiary, Ledger zero and the trial balance zero. All right, we'll see what happens next. We're now on 22 Gonna skip a line. Received auto service on account to be paid in the future. All right, so we got auto service, and we're gonna pay it in the future. And therefore, is cash affected? No. We're gonna pay it in the future, so we got service, but we're gonna pay in the future. We owe money. What's the account? That means we owe money in the future. Accounts payable accounts payable, though, is a liability count. It might be easier for us to think about what we received. And what did we receive? Auto service. Now we might be thinking well, although it could be an asset, but this is the service which is probably an expense 5. 40 700.10 Accounts payable subsidiary ledger 700 part 2-Accounting%2C Financial: What did we receive? Auto service. Now we might be thinking. Well, autos could be an asset, but this is the service, which is probably an expense. It's something that we have consumed. We see auto expense here, so we're gonna post it to the auto expense. Auto expenses, like all expenses, have debit balances represented by the fact that they do not have brackets. We need to make it go up because expenses only go up. They only go one way. How do we make something go up? We do the same thing to it, which in this case, would be another debit. So I'm gonna copy the auto expense copy auto expense. And we're gonna pace that on top in C 11 red click and paste it. 123 So how much did are we gonna pay? We're gonna pay the 3 20 with the auto expense. Then we're gonna credit the same amount of 3 20 credit 3 20 And the only question is what are we gonna credit? Where he touched on it? We're gonna credit accounts payable now. Does it make sense that we credit accounts payable? Well, accounts payable is a credit bounce account because it's a liability. And we need a bad thing to go up because we owe more money. How do we make something go up? We do the same thing to it, Which in this case, would be a credit. So, yeah, we're gonna credit that account. Copy that. Gonna put that on the bottom cause credits. Just traditionally go on the bottom in cell C 12 right. Clicking and pasting. 123 So there's our transaction going to post that to three locations. First location being the trial balance. So here's auto expense. Here's auto expense on the traveling. Here's what we're gonna post the auto expense on char balance in cell I 15. So within I 15 1 site equals pointing to the auto expense of 3 20 in D 11. What's gonna happen? The six hundreds gonna go up in the debit direction, put us back out of balance and net income will go down so the expense goes up, net income goes down. And remember, net income is revenue of a credit minus the debits. The credits are winning by 3086 80. Now we're gonna post the other side to accounts payable. So here's accounts payable. Here's accounts payable on the trial balance. There's something in it, even though it zero what's in it. E six plus d eight. We don't want to delete that. We're gonna double click on that, go to the end of it so that we can see the activity within here and then say plus and point to that 3 20 which will make the accounts payable call up to 3 20 and put it back in balance. The reason we want those formulas is that we can then easily see by double clicking what is in there. We can also use these formulas up here to see what is in there. Those foreigners are located in the formula tab under the formula auditing. So these are the items here. I like to put it up here, and I'm gonna get rid of that. All right, so now we're gonna post this to the subsidiary Ledger. Why? Because the common question with accounts payable will be How much money do we owe people? Well, the trial balance says, Well, people 320 who do we owe? And when do we owe them? Well, for that information, We're gonna need a subsidiary Ledger breaking it out by vendor. We're gonna go over here. I'm now. It didn't tell us in the question, but I'm assuming the vendor must be this one related to auto A auto over here. So that's where we're gonna post it. So I'm gonna post it in the credit side to this particular vendor in and 16 saying that this equals And then point Teoh that 3 20 bringing the bounce up from through zero by 3 22 3 20 like So Now all of our vendors, of course, add up to that 3 20 which ties out to the trial balance. Now, we're also gonna record that to the general Ledger. So the general lied. Remember, every account has a General ledger account. It's in order just by date. And we're just gonna record the General Ledger account Fourth accounts payable on Lee just to compare and contrast the G l account four accounts payable, and the new account that we need just for accounts payable being the subsidiary count for accounts payable. So we're gonna points that same information over here in the credit side equals in you 11 equals the 3 20 bringing the balance back from zero up to 3 20 So now the general Ledger adds 3 20 The subsidiary Ledger as the 3 20 the accounts payable. Trial bounce adds to 3 20 we can look at the next transaction, which is on to 15 business meal at Outback on account to be paid in the future. All right, so we had a business meal, and again we bought it on account. So is cash affected? No, we bought it on account were paid in the future. Therefore, we have an IOU, the IOU account. When we owe someone else, money is called accounts payable, but again, it's a It's a liability count. We might want to think about what we got in this case. We got, uh, meals. So meals and entertainment that's gonna be a type of expense down here. So I would say that's in the expense area. All expenses have debit balances. They only go up. Therefore, we're gonna debit the expense account of entertainment expense in this case. So I'm gonna copy that. We're gonna put that on top because the meals generally go on top of that debits generally . Yeah, Debits Journal And go on tops and have pace that 123 up here. And the amount will be then for 640. So if we debit something 6 40 we are also going to credit something 6 40 We will represent credits with a negative 6 40 And that will put brackets around it for this problem. Intern formats it for us. Then we just need to know what this account should be. That we will be crediting and we're ready. Said that that will be accounts payable. Does it make sense that we would credit accounts payable? Well, accounts payable has credit in it. We need to make it go up because we owe more money. Therefore, we need to do the same thing to it, has what it is. It's a credit eso crediting would be the same thing to it. And that will make it go up that for so it makes sense that we credit accounts payable. So I'm gonna copy that g 10 were to copy that. We're gonna put our cursor in C 15 right click and paste. 123 Now it's post this to our three locations. First location being trial Balance. We're gonna be down here in I sixteens were in I 16 at the moment equals that we're gonna point Teoh the 6 44 the meals and Entertainment. And once we hit Enter what's gonna happen? It's gonna go up by 6 40 put us out of balance and net income will go down. So there we have that. Then we're gonna post the accounts payable to the tribe. Bounce. Here's accounts payable. Here's accounts payable. Here's what we want to post it. There's something in there. What's in there? E six plus a plus e 12. So I'm gonna double click on it, not delete it, go to the end of it, and then select plus and point to the accounts payable. Note that we're never gonna put a negative sign in here. We're just gonna say equals and or pluses. All the negative signs are gonna be represented here. So then we're gonna select enter, and it goes up to 9 60 puts us out of balance. And of course, if you get confused on that, then you know you will see that if we go the wrong way by the fact that will be out of balance if it goes the wrong way. So now we're back in bounds. We're gonna post that same information to the subsidiary Ledger. Why? Because really the accounts payable. Usually the questions that will be asked, How much do we owe people? We owe people 9 60 saying that we can see that on the trial balance. Well, who do we owe and when do we owe it? Well, for that, we're gonna need a subsidiary ledger in order by vendor. So we got the subsidiary Ledger by vendor. We're gonna go out back over here in Q nine. So we're in Q nine, reflect equals and point Teoh that 6 40 credit in this case bringing this balance up to 6 40 And now the total adds up to 9 60 bean, the 3 22 a auto and 6 42 out back. There's the 9 60 which matches what is now on the trial balance. Once again, we're also gonna post this to the General Ledger. So every account has a general ledger that General Ledger is going to be in order by date, and therefore we're gonna post this same information over here in cell, you 12 equals and win a point to that 6 40 So there we have that Remember, every account has a general ledger were only looking at the General ledger for the accounts payable account so we can compare it. Teoh the new activity being the subsidiary Leger. We can see that the general enter by date adds up to 9 60 That subsidiary, Ledger by vendor as of 9 60 and the trial balance adds up to nine. 60. All right, last thing. And then we have to stop here. So we're gonna go to 3 15 Says we paid out back for the purchase of business meals in past . All right, so now we're just gonna pay that account off, and therefore, is cash affected? Yeah. We paid with cash again. So cash has a debit balance, will make it go down by doing the opposite thing to it, Which in this case, is a credit. And you might be saying we probably pay with a check, but again, that's the same thing. Cash and check. We're gonna put those in the same account, foreign out the cash accounts pretty much our checking account. We're gonna copy that. We're gonna put that on the bottom credit. Traditionally, go on the bottoms of red, click in C 18 and paste it. 123 The amount will be for a negative credit being represented with negatives of 6 40 in cell E 18. If we credit something, we're also gonna have to debit something for that same 6 40 The debit will go on top. And then the only question is, what should that account be that we will debit? Well, why did we pay cash? Because we bought stuff, but we bought stuff in the past, and now we're paying off what we owe the account showing that we owe people money is, of course, the accounts payable. So accounts payable have that 9 60 We know we're gonna debit it because credited cash Does that make sense? Well, 9 60 has a credit balance in it. We need to make it go down because we paid it off. Then we don't owe 9 60 anymore because we paid off 6 40 of it. How do we make something go down? We do the opposite thing to it, which in this case would be a debit. Some does make sense that we're gonna debit it. I'm gonna copy. This is gonna put that in cell C 17. See 17th right there and right click and paste it. 123 All right, so now we're gonna post this out, so we're gonna post it first to the trial bounce. So here's the accounts payable. Here's the accounts payable. Here's the accounts payable where we want to post it. It's got a bunch of stuff in it, so I want a double quick on it, not delete all the stuff in it. I want to go to the end of it and say Plus, then posted at 6 40 What's gonna happen? It's gonna make the accounts payable. Go down and it puts us out of balance. Then we'll post a cash. So cash is up here. We're gonna post this cash to the trial balance here and were posted to the blue area. There's already something in it, though, Therefore, we're gonna double click on it, go to the end of it, and then select plus, and then we want to point to that 6 40 What's gonna happen when we select enter, It's gonna bring the balance down here in the cash count and put it back in balance down here so that we have that. Then we're gonna post the same information to the subsidiary Ledger. Why? Because when we think about accounts payable, the question will often be how much money do we owe people? Trial balance says, Well, people 320. But who do we owe and how am I gonna write the check out to? Well, let's take a look at the subsidiary Ledger over here to answer that question. So we'll go over to the subsidiary Ledger, which is in Broken Out by vendor. And in this case we are talking about out back is the person we paid in p 10. So within p 10 wouldn't say equals posted this same activity that same 6 40 and enter. So here's the normal activity. We expect to see there's the 6 40 increase in the payable. Then we paid it, so it went up, and then it goes down to zero. And we're also gonna post that to the General Ledger just to see the contrast between the General Ledger and the Subsidiary Ledger for the account of accounts payable. So we're gonna be in the credit side, is gonna post that same information in cell t 13 equals, pointing to that 6 40 And once again, that credit balance is going to go down from 9 62 3 20 So we could see that same kind of information. That same pattern where we haven't went up 6 80 Then it goes down, we pay it, right, we Then it went up, we bought something, and then we haven't paid that one yet, and then it went up and then we paid this one off. That's the normal thing. We should be able to check off. You know, the activity that happens and see that pattern within and accounts payable accounts this, of course, being a bit simplified of account in the G L. Because it is in order Onley by date, as opposed to over here it being ordered in order the same information by vendor. And of course, now the G L ties out to 3 20 as does the subsidiary Ledger time after 3 20 and the trial balance also has 3 20 6. 50 Worksheet Sales Journal: In this presentation, we will record sales transactions or revenue transactions using a sales journal, as opposed to using a general journal. We will be using the data on the left side. These will be the sales that will be taking place in this current month. We will be recording those to the sales journal, and that is as opposed to a traditional journal entry where we would have the debit and credit recorded out and have to line items for each item. Once we do have the sales journal completed as of the end of the month, then we'll go through and we'll do the entire month's worth of information in terms of sales to our general Ledger with just one journal entry and that will simplify the process , will then post that information to the general ledger over here and then that will create the transaction on the trial balance, and we'll see how this whole process is taking place. Our goal here is to focus just on those sales transactions. These are gonna be normal day to day transactions that are going to happen throughout the cycle throughout the month. Three idea here being to simplify the process also often done in some type of manual system when we don't want to record the journal entries and maybe we don't have an automatic or automated system in order to do so. If we do have an automated system, it's still good to practice the sales journal because it's often the case that we will want to see this data in a similar format as a sales journal. In other words, we will run reports, which will often show sales broken out in a similar fashion, wanting to focus in on those sales transactions. So it's a good idea to look at these. We've taken a look at the normal journal entries four sales in the past. We're going to simplify the process by having just a sales journal. Now, the first item here, we're gonna have a sale journal, as if were a service company rather than a manufacturing company or a merchandising company . Therefore, not dealing with inventory, having as simple a sales journal as possible. If we have a service, we provide the service, then we could just record the transactions here into our sale journal, and if all the prices are listed, weaken list out the price, and we have the debit and credit recorded here. Note the simplification here being that we just need the date and and we just need to record the transaction one time. One amount in this column this column representing both the debit and the credit side. So we just put the one number here represents both the debit and credit note. However, we do need the customer as well because we're gonna have to record this not only to the General Ledger. We'll also have to record it to the subsidiary Ledger in order to know who pay, You know who owes this money. The sales journal also is on Lee going to be there, not just when sales happen but when sales on account happen. In other words, Onley sales on account will be recorded here. And if we had a sale for cash even though we had a sale and it is a sales transaction, it is not going to go in the sales journal because we received cash and it would go in through the Cash Receipts journal. That's gonna be the most common problem that we see. When we first learned these journals And that's pretty much because the simplification of the name here isn't as specific as it should be. It's really a sales journal on account sales, general four accounts receivable. If we got money for that sale at the same point in time, then we would record it in the cash receipts journal. So we're just gonna list these out as they happen. So here, if we just had a list of the sales as they happen during the process, the same list is basically gonna be over here. We're just going to say, if we to sail happen at 7 17 it's a service company. We had a sale, were going to say the service was for P company. That's who we sold to. And the amount is 720. That's all we have to list there. We don't need to list out debits and credits because the debit and credit is listed here. Now we're gonna add these up at the end and then post these to a journal entry. But we may want to post them as they go, also to the subsidiary Ledger, not the General Ledger right now. But the Subsidiary Leisure, which need to be broken out by customer. So in this case, the sale was P company. I'm gonna scroll over here and in a scroll down to P Company and the subsidiary Ledger is going to be down here in our worksheet. It's under these two lines. The accounts receivable subsidiary Ledger is right here and soapy company. I'm going to say it's a debit because it's in the accounts receivable. I'm gonna do this with a formula someone say equals and then go find that number and scroll up Scroll to the left. And I know this is hard toe manipulated around, but it's gonna be a e four and enter, so you could just type in that number. But it's better to use the formula if you want to just put equals E four. If you're using the same cells, you can do that. I do recommend putting equals and then going through the screen because it's a good practice toe work through the Excel sheet. Now this is our subsidiary Ledger, which is going to add up if we add up our customers on add up everything in the Subsidiary Ledger which are gonna be these. What was that 12345 customers Right now, then it adds up to 7 20 The reason it's red at this time is because that's 7 20 does not match what is on the trial balance right now. It will, after we record all transactions and then the total to our general entry and post that to the General Ledger. So we'll do this process all the way down. The next one is just gonna be the same thing. 7 24 7 24 There was another sale that was made to service sale in that selling inventory so we could call it fees earned journal. But that's typically it's typically called the Sale journal, and we're gonna see this also to p company. And that was 425. So that's all we have to record. We don't have to record the deputy and credits. This row here shows that it is both a debit and credit. So we're then gonna post that not to the General Ledger right now. But Teoh, the subsidiary ledger again four p company then posted to the General Ledger all activity for one journal entry for the entire month. So we're gonna scroll back over here, then scrolling back down to the P Company. We're gonna be in sale I or A II 33 we will say equals gonna go all the way to the left. I'm just using the arrows now school and all the way up. And we're gonna point that for 25 on E five and then enter again. You could come down here to this cell, which is a I 33 p company accounts receivable subsidiary Ledger, and type it in there or tech the number or this formula E equals e five and Internet should pull over. So now P company owes a 7 20 plus the 4 25 or 1 1045 and that should tie out to what we have down here. So that looks good and scroll back up to the next one. We're just gonna record. This is they're just normal sales that are happening through the month. Note. We are jumping forward in time. We only have a few sales for the month. It depends on the type of company in terms of how many sales they would have throughout the day. it could be a type of company that makes a lot of sales through the day. And that's when this process could be very useful because it'll simplifies that sales process even with a less computerized system and allow us to then do one journal entry at the end to record all the activity for the day, week or month. So next transaction is gonna be 7 30 And this is kind of Beaufort s company. These people were selling it to you, by the way. Not very creative names, but as company, that's use. That's it we're selling to here, and that's gonna be for another 425. And so we're gonna put that in our subsidiary ledger again, not posting it to the General Ledger. We will do that once. We some always up for the entire month but posted it to the subsidiary Ledger breaking out by who owes us money by customer. It's going back over scrolling back down. We're looking for s company over here. So here's our subsidiary Ledger. Here's s company. We are in a M 30 to sell a m 32 and within their I'm gonna do this with a Formula one more time or once again, not one more time and we're gonna say equals. And I could do this with the arrows now going to scroll all the way to the left and then we're gonna go up with the arrows and it just keeps on changing the cell reference until I hit. Enter until I stop it, I'm gonna go up here and we're gonna go to that for 25 in e six e six and enter, so you could just type it in to hear I'm back here. 2 a.m. 32. You could type it in for S company subsidiary Ledger for 25 foot. I recommend a formula either doing it that way, which I highly recommend because then you can maneuver around the Excel sheet and see how it works or type in the formula. E equals e six, and that'll pull in that information. Let's see the next one. We're going to school, and obviously now, once again, the subsidiary Ledger is adding up to 1005 something and that's gonna be the adding of these two summing up to the subsidiary ledger. That would be the total accounts receivable red because it's not currently being reflected . What is in the accounts receivable account? Not until we do the final journal entry at the end. Next transaction is gonna be on 7 30 We're gonna say that M company, there's another sale in company. And that's gonna be for 4 25 as well. Actually, no. This is gonna be for 505 100 for em. Company. So that's gonna be our last transaction. Note. The dates are gonna be different again. These are just gonna be transactions that are happening throughout in this case of the month, and we're gonna be recording it for this time period. We could do this sales journal on a daily basis, a weekly basis of monthly, depending on the time period that is covered And how often we want to record this on. Group them up and record it to our Ah, General Ledger. We're gonna post this out once again, Not to the General Ledger yet. We will sum it up after this and then do a journal entry posting it to the General Chur, but now posted it to the subsidiary Ledger to M Company. So we're scrolling back over. Scrolling back down. The subsidiary ledgers down below this red line. We're looking for him, cos so we're gonna scroll down. It's gonna be here. Here's M company. We are in sale a M 40 a. M 40. So within a and 40 we're gonna do a formula to pull that 500 over equals. I'm gonna scroll left with the arrows. Now it's just gonna keep changing the cell reference until we stop. And we had entered to where we wanted to be, and we're gonna screw over to that 500. So there's the 500. It's in Sale e seven and enter. So there we have it. So once again, we could just type it into So am 40 typing Indy 500. Bringing that amounts over or we can put equals e seven. I do have a recommend using the formulas. So now our accounts a stable subsidiary ledger shows $2070 that red because it's not reflecting what is in our ledger. In terms of the General Ledger or the trial balance, it will hopefully, however, once we do the transaction at the end of the month being the some of the sales journal. So now we're just gonna some these up. We're gonna Adam up the 7 20 plus two for 25 for 25 plus 7 20 the total sales made during this time period. So let's do that equals organize the some function. Most use function when we really want to know s, um and double click that some function. Highlight the 7 20 down to the 500 and enter. So that should match at 2070. Should match what we had in a subsidiary. Legible Double check in the second, but I'm very confident it's gonna It's gonna match. So now what we're gonna do is a journal entry, but journal entry, one journal entry instead of however many 1234 journal entries here. And obviously, if we had a lot of sales transactions, this could save a lot of times for journal entries Would be a debit and credit here debit credit here, a debit and credit here in Devon credit here posting that out to the General Ledger, making the trial balance each time, whereas this then just grouping them all together and posting the transaction as a whole. The total amount for the time period in this case of the month in one journal entry. So that's the time saving principle. If you do have an automated system like a scanner or or if you're putting this into ah QuickBooks system or something like that, clearly the system will help make that faster. So the journal entries can happen as you go through the process a lot more easily. If you're using a manual system, then a sales journal such as this can save a lot of time. If, however, you are using a automated system, you may want to generate reports similar to the sales journal. So it's it's useful to understand what sales journal looks like and have have the sales listed out such as this. People could ask for reports in something like a like a sales journal and give you that information in software can basically generate and pull this information and put it into this type of format so the journalist is gonna be as of the end of the month, so we're in Z five. We're gonna say 7 30 they in the date, and we're gonna type in the ah Justin entry which is listed here, accounts receivable to debited sales is credited. Why? Because it's our normal type of transaction for a sale. Went on account that sales on account. Meaning we didn't get cash at the point Time of sale. What did we get? We got an I o U and Accounts receivable councils. Evil is a debit balance account. We're gonna make it go up by doing the same thing to it. Another debit. So the debit goes on top, I'm gonna copy the accounts receivable in a F six paste that in a a five right click and paste 123 And that's gonna be for the total amount that 2070. So we're going to say 2070. Then we're gonna credit something. I'm going to represent the credit with a negative or bracketed numbers for our purposes. And in the credit column here, I'm gonna do that with a little formula by saying negative to flip the sign instead of equals and pointing to that 2070 that'll take that amount, flip the sign, they get a negative, then we're gonna put the credit here so they credit. Ben is going to go to some revenue account. In our case, it's gonna be called just gonna call it revenue. And that could be a little confusing, cause we called it the sales journal, which is typically the name for this type of journal. And it typically I za name Using sales is the type of revenue account often use when selling inventory items. But it's the same kind of it's a revenue journalist income journal type of journal transaction here. So we're going to say it's the revenue revenue has a credit balance. We're gonna make it go up by doing the same thing to it, which in this case, is another credit. So we're gonna copy that. But that a top in a a six right click and paste 123 We could indent this just for formatting purposes by going Teoh the home tab alignment and increase in dent. Or just double click on it in space for three times. And that's just for the formatting purposes. Okay, so now we're gonna post this out, we're gonna post this to the General Ledger, which will then form at the trial balance for us. So the general ledger is over here. This whole thing is gonna be the General Ledger Onley. All it's doing is recording the same accounts in the same order, assets and liabilities and equity than revenue and expenses. So we're going to start off with accounts receivable. That's the second to count on the trial bounce and therefore the second account in the General Ledger. So here's the General Ledger were in accounts receivable. The second account, it's going down and then over. So cash counts table and so forth. And then we're gonna go here. Teoh Ai 16. We're in a I 16. Going to use a formula equals and will point to this 2070. And when we had entered, this will go up. The accounts receivable will go up here and it will go up here and we'll put us out of balance down here. So let's do that. Enter. So it went up here. There it is, here, on the accounts, payable, pulling over from the General Ledger. And we are, of course, out of balance down here. Now we're gonna record the second component, the revenue component. The revenue component is here, so it's, you know, it's it's the first dark blue account. So it's kind of in the same order. When we go to the trial balance or the General Ledger, we've got the asset accounts. We've got the liability accounts, we've got the equity accounts and then revenue. So we're gonna be way over here in a Z 22. We want to be on the credit side. So here's revenue Credit side. We're in a Z 22. We're gonna do this with a formula, so I'm gonna do that. Equals here in order to just pull this over and then go point to that cell. I'm gonna do that with the arrows so we'll go all the way. Left many all the way left here. Scroll up. And we're trying to find that revenue account and that credit of 2070. So it's in a C six and then enter was pulling over that information. So there it is. This number is pulling from a C six and there's the 2000. There's the credit. You could type it in here with a negative, or you could just use the formula equals a C six. As long as we're on the same sales and using the exact same formatting, and then that number will then pull over to, of course, the trial balance. There's the trial balance. There's the 2070 and we're back in balance here. Here's the net income. Remember that? Is net income not lost? It's taking the credit in revenue minus the expenses. The credits went in here by the 2070. That means that we have net income of the 2070 as we would think, because it's the sales journal, we made sales. We earned revenue, even though we didn't get the cash yet. Also note. At this point in time, we now have the count's evil at 2070 and the accounts receivable sub ledger. I mean the accounts people General Ledger at 2070 and then they count foreseeable sub ledger, adding up all of the accounts by customer also lining out to 2070. So when we work with accounts table, we have to do this extra step of the sub letter listing out who owes us money so we can better handle the collection action and trying to collect the money that people will owe us . Also note that When using a system like this, the information won't be correct until the end of the time period on our financial statements were our trial balance. Until we record the journal entries record of the transactions for the entire time period, whether that be day, week month in this case with the month. 7. 60 Worksheet Sales Journal Inventory: in his presentation, we will inter transactions into a sales journal using this information over here related to sales. And we will have in this sales journal both a sale that has the accounts receivable and sales component to it, as well as the cost of goods sold and inventory component. In other words, dealing with sales of inventory items as opposed to dealing with sales where we don't have inventory. So if we were a service company and we had a sales journal, then we would just have this item here where we would have accounts receivable in sales or revenue. And we would record the sales as we go if we are selling inventory than there are two components that we can put into our sales journal, and that will include the accounts stable and sales and the cost of those items. So we're gonna enter that data here into the Sale journal. Once we have done that for the entire month, we will enter that data into the job. The general journal being here. That's gonna be the entire month's worth of information. We will enter in one transaction for the sales transactions. That being the purpose that saving time, then posting that to the General Ledger and seeing the result in the trial balance from that transaction recording all the information for the month related to sales. Remember that the sales journal's gonna be used in. We can think of it as being used if we are using a less automated system or um, or manual system in terms of the sales journal. And that's going to save times because we are going to be putting things in Ah and one line item as we go and that'll save us time. It won't be posting it as we go. It is useful to see the sales journal even if we are using an automated system, because it is often the case that we will have the reports that we want to see in terms of a sales journal type report. We also want to see different forms of how a different account in format or structure can be put together. Look at the pros and cons. Look at the differences and similarities. So first we've got on 7 17 p company and we have 7 20 Sales cost 5 45 54 So we're gonna just list this out and sales journal pretty straightforward. Every sale is just gonna be a listed out here. We're gonna set P company. That's who we sell to. That's the customer. And then the accounts receivable. Of course, the sales amount is going to be higher than the cost were selling them for more than we purchased them for. In other words, and Newt, the sales journal only represents sales that are made on account. If we got cash at the point of sale, even though we made a sale and would still be crediting sales, it's not going to go to the sales journal, the sales journal only recording those sales on account those of sales. We didn't get cash for those journal entries where we're going to increase accounts receivable, so it's gonna be 7 20 this side's for accounts stable and then 540 on the cost of goods sold side. So this represented increase accounts receivable increase in sales and which is revenue or income increase in cost of goods sold and decrease in inventory here. Net income going down from this transaction and the inventory going down. So we're gonna report this as well. We're not gonna post it to the General Ledger. Not until we do all the end until we get to the end of the month. But for the sales journal, we're gonna posted to the subsidiary Ledger as we go to show who owes us money so that we can go through the collection process at a later time. So we're going to say Pete, companies who were looking for we're going to scroll over to the right scroll down. We're looking for P company. So here's P company here in our subsidiary Ledger. So we are in accounts receivable. Subsidiary Ledger, P company, Debit side in Cell A J 32. We're gonna do this with a formula, so we'll say equals and I'm gonna scroll to the left, going to screw up. And we are looking for that, um, the receivable here, the 7 20 and enter. So we could just type this in here if we want to. But I recommend formulas. You could also tap in equals e four, and that'll pull in these 7 20 we now have in our total subsidiary ledger that 7 20 adding up all these customers here that seven twenties red because it does not now match what is on the accounts of people geo and accounts receivable. Trial balance. It won't until we reconcile at the end of the time period, recording all the all the transactions for the accounts receivable at the end of the month . Now we're gonna go to seven. 24 once again, p company and it's gonna be the same. It's format here, which can say we sold it on the side accounts receivable and sales for 25. We purchased it for 3 27 Same information, slightly different sales amounts. So he has a different type of hail, but we're gonna post this to pee subsidiary ledger again. So again, we're not posting to the g l not posting it up here, but we are gonna post it to the subsidiary Ledger as we go. So now we're down in a G 33 a. J 33 in p company debit side for the Subsidiary Ledger. We're going to do this with a formula saying equals scroll to the left, scrolling up, and we see the 4 25 here in e five and enter so once again. You could type in for 25 or you could type in equals e five and then enter. And that should go from 7 20 up by 4 25 to 1 1045 which is currently are total. Once again, it's red because we have not entered all the information into our journal entry. Then we're gonna have on 7 30 we're gonna have s company, and that's 4 25 once again. So we're gonna say the sales for 25 3 27 is the cost. Note that if we're a smaller company, that's doing this and we have to make the sales a lot of the times thes the sales price will be much of the same. We may be selling very similar items or ah, variety of items that will have similar sales prices here. So we're going to say that this will be s company. So we do the same thing posted it not to the geo yet, but to the subsidiary Ledger. So we're gonna scroll down finding that subsidiary ledger for s company. Here it is. Here's the subsidiary ledger. We're gonna be in the debit side. We are in sale A in 32 32 32 we will say equals and then scroll to the left. We're gonna find that transaction scrolling up. And there we have it that for 25 in E six, So with an e six and enter and again if you could type it in there. But I recommend formulas. You can also type in the formula of E six equals e six, then works currently at a total of 5 1070 That's still read because we haven't done our journal entry here yet. We will do so at the end of the month. Last one, we're going to say on 7 30 we have for em. Company sale of 500. Costs for that cell is 3 85 And there we have that information. Now we're gonna post that the subsidiary Ledger once again. Not the General Leisure. The subsidiary letter for em. Companies rolling to the right, scrolling down, looking for em company. So here's him company. We're gonna be on the debit side. So we're here in a in 48 40. We will say equals scroll left, screw up and there we have the 500 here and enter. So now we have 2 500 m again. We could type in e seven to enter. That information are total now is 2070 once again is red because that's not what's Inner Geo and that's not what's on our trial balance. However, we are now going to sum up this information and hopefully that will add up to the same amount which we will then post Teoh the G l and then create the trial balance from it. We're gonna put the total we're gonna some these up to 7 20 plus two for 25 plus for 25 plus the 500. Doing that with the some function we're gonna say equals s, um DoubleClick. The some function highlight from the 7 20 down to the 500 and enter. So there's our total there. That's 2070 and we're going to the same thing on this side. We could drag it over by some these up so we can see the some functions. He is adding this up people's the S, um, and some function adding the 5 55 5 54 down to the 3 85 enter. Now. These are all underlined over here. I'm gonna underline both of, um so here we have the underlying and then we'll double underline here just for formatting purposes. So there is our amount. Now we're gonna dio the journal entry, um, related to the entire sale. Months worth of sales note. Of course, once again that we don't have many transactions here, but if we were depending on the company we were working at, we may have many transactions per day. And the more transactions that are the same, the more this time of system would work well s so that we could just record it all at one time and then posted over here. So we're going to say this Is that this at the end of month 7 30 And there's gonna be two components now, of course, and it lists it on the sales journal. We're gonna accounts receivable, debited, and then sales credited. I'm gonna do this with two separate journal entries, As is normally done for demonstration type purposes may not be the case for software toe have to separate challenges since they do happen at the same time. But we're gonna break this out. As is the tradition for our demonstration. We're going to say that Accounts receivable is gonna go up Council people's an asset account has a debit balance, and therefore we're gonna make it go up by doing the same thing to it. Another debit. So we'll copy accounts receivable and A J A g six right click and copy. We're gonna put that in cell A B five, right click and paste. 123 The amounts gonna go here in a C five and we're gonna do that by saying equals and then pointed to that 2070 and enters, and we're just pulling that over, and then the credits gonna be the same amount. But a credit. I'm gonna do that with a formula. Nice, simple formula instead of equals, heading negative. And in selecting that 2070 taking that number and flipping the sign so that we have that now we just need the other account, which is sales or revenue. And so free school, down, assets, liabilities, capital or equity. And then the sales are here sales that needs to go up. So it has a credit balance. We're gonna make it go up in the credit direction by new on the same thing to it. Another credit. So we're gonna right click and copy, and then we'll scroll up and we'll put that underneath in 86. Right? Click and paste. 123 So there we have it. Our first journalists already indented for us. If it weren't, we go to the home tab alignment and increase in denting. So now we're gonna post this. I'm gonna post this and then do the second component here. So we're gonna post this to the General Ledger posting first, the accounts receivable. Here it is, here in the journal entry. Here it is there in the trial balance. Second account down the trial balance. Then it will be the second account on the General Ledger as well. Here's cashiers accounts, table or on the debit side. We are here in a j 16. We're gonna do this with a formula saying equals and then pointing to that 2070 bringing that zero balance up by 2072 2070. Here's that 2070 here on the trial bounce being brought over. We are currently out of balance by that amount until we record the other side. Here's the sales item on the journal entry. We need to report here it is on the trial balances in order Assets Liabilities Equity than sales were looking for that first blue account on the general ledger. In other words, so we're scrolling over here the assets and the liabilities. Here's the equity and there is the sales that we are looking for. We want to be on the credit side or hear sales credit side. Here's the credit balance. We are in sales a B 22 a b 22. I'm gonna say equals and then scroll to the left until we find the information we need. And there it is that 74,070 in 86 enter. That's a bit of scrolling to get over there. I know. So you could type in a negative 2070. But I'd rather see the form let rather use the form than work to find it. Or you could type in equals 86 enter. And that should pull over that cell reference as well that 2070. Now, of course, appearance here on the trial balance and appearing as a net income. It's not net income yet the though, because we haven't recorded the second component of this, that being the related cost of goods sold and reduction of inventory. So I'm gonna skip a line and do this in its own transaction. Now, I'd like to think of the inventory first. I think that's more intuitive for more people. It's tangible. So people say inventory will typically have a debit balance and we're making it to go down . Therefore, we're gonna do the opposite thing to it. Now note There's nothing in inventory right now, and that's because we're recording the sale journal before the purchases journal. So once we record the purchases journal, there will be something in here. So as of the end of the month, we're gonna record all the all the journals. So we're actually gonna end up with a negative inventory at this point until we record the purchase journal. So I'm gonna copy this. We're gonna say copy when it skip a line, we're gonna put this on the bottom here. So in the new journal, entry and then on the bottom in a B nine, right click and paste. 123 I'm gonna indent that. Go into the home tab alignment, increase indentation. Then we're gonna go to the credit side in 89 gonna pull this number over. But instead of doing that with an equal, we're gonna say negative and then point that 5 1093 and enter and that'll pull it over. Then we're gonna go on on the top here, a C eight. We're gonna take that number, flip the sign and pull it up here. I'm gonna do that with our little formula, that being negative instead of equals of that number taking that number and flipping the sign so that we have that. Now we just need to know what this account will be and we can see. Here it is. Cost of goods sold the expense related to us consuming the inventory. Here it is. On the trial balance, we can see it's in the expense area. It's gonna go up in the debit direction. So we're gonna copy that cost a good sold. We're gonna put that here on top, a B eight, right click and paste 123 So that we have that. Now we're gonna post this. We got the cost of goods sold first. So that is all the way down here. It's a second dark blue account, second income statement account assets, liabilities, equity income and expense being the order. We're looking for that second income statement. Count on the general ledger. So here we have the assets. We have the liabilities we have the equity revenue and expenses were looking up here. Cost of goods sold in A and B D nine. So we're in costing a soul debit B D nine. Well, say equals, we're gonna scroll to the left. It's gonna scroll all the way to the left till we find our amount in a C eight of the 5 1093 and enter. So there it is, 5 1093 If I scroll back over here, it is that down here, 5 1093 Now we're going to the inventory. Here's the inventory we want to post here. It is on the trial balance. Third accounts gonna be the third account on the General Ledger. Therefore So the General ledger here it is 30 countdown. We're looking for inventory to be a credit, and it's going to go in the credit direction, have a negative kind of inventory, which is not the case, because we haven't recorded sales journal yet, so be aware of that. We are in a K 23. Well, say equals scroll to the left scroll back up. And we're looking for that 5 1093 and enter there. We have it. So we have this credit in inventory until we do the purchases journal. Here it is, the credit and inventory here, and that's gonna be our transaction. Note. What happened here on the income statement? Side revenue went up by 2070. That's a credit. Not a negative in terms of this worksheet and then cost of goods sold. Went up the net of those two, then being a net increase of 477. That's gonna be the sale journal. Note. Note how specific the sales journal is on. Just note that if we do make a sale for cash that it wouldn't go here. This is really specific journal. One of the most specific type of journals we have only a sale on account. We'll go here and is very definite. Basically, where we are gonna put this information we don't have, like we've happened. Some of the other special journals. In other words, another account, typically in a sales journal. 8. 70 Worksheet Purchases Journal: in this presentation, we will enter transactions into the purchase journal related to purchases. The information will be over here on the left side that we will be then using to create the purchase journal. We will be entering data for the entire month of purchases here. Then at the end of the month will have transactions that we will sum up, record them in a journal entry format to the general journal, posting it then to the General Ledger and finally seeing the results on the trial balance. From that posting, it's going back over. We got the purchases journal. Remember that the purchases journal and these types of special journals will be used typically in a system where we are doing it by hand and therefore recording the normal type of purchase transactions. If we do a normal to end, that's gonna be useful, because it it stops us from having to record the accountancy or the two transactions that debits and credits and posting it each time rather than or instead of that. Then we will be reporting that just one time at the end of the time period and just listing out the activity as we go. If we have an automated system, we may not use the same type of. We may not need this type of process because the automated system would be in such a fashion that we possibly could to put the information in fairly quickly. However, it's still good to see the purchases journal because we may generate reports related to a purchase journal type of format within software. It's also good just to see how the accounting system can be formatted in different ways with the similarities are what the differences are with the pros and cons are of different types of formatting. Now the purchases journal depends What type of company are are we are in when we deal with purchases, but typically it's gonna be dealing well. It will be dealing with all the time with something related to accounts payable. So note that the driving term really isn't exactly purchases. It's something that we're doing accounts payable with me, and we're buying something with accounts payable on account rather than paying cash. If we were to pay cash, it would go into the cash payments journal. However, if we're gonna buy it something other than cash, it would go here now if we sell inventory, often times would be purchasing inventory and that would be our normal transactions. If we don't. If our service company we might be purchasing in this case landscaping supplies in the purchasing journal, the account that will be there no matter what, however, will, of course, be accounts payable that will be going up with credits as we purchase things on account. Kind of like purchase things, purchasing things with a credit card. So let's see what we have. First, we've got theseventies five first transaction purchased lawnmower and garden tools from L and H Uh, n G company on account to be paid later, 1500. So we're going to see the vendor is L, H and G, and we're going to see the accounts payable will be going up in the credit direction 1500. Now the other side are default here because we're gonna be landscaping will be landscaping supplies. That's what we're typically gonna purchase. This, however, looks like we're purchasing more of equipment. Purchasing a mower and garden tools may be something that we have to capitalize. Therefore, I'm gonna put it over here rather than landscaping supplies, which are gonna be more smaller, supplies, smaller tools, possibly putting it into the other account. And we'll have to break that out at the end of the time period. Then we're gonna say the next transaction, we're gonna record all these and then we're going to sum them up and then post them and record the math. A journal entry, all combined journal entry at the end of the process. Now, we purchase landscaping supplies from a company on account to be paid in the future. So we're going to see the vendor is a company. And that's how we purchased from its gonna be accounts payable. We're always gonna have accounts payable because it is the purchases journal, which basically means the accounts payable journal. That's 185 and then the other side. This is gonna be kind of our normal account here now, because we do landscaping and this will be our default. Typically, we buy stuff on account within the landscaping. If we were to buy inventory or a different type of company that had inventory purchases, maybe inventory just depends on the type of company what will remain again. Is the accounts payable being the same. And so 185. They were gonna say next transactions on 78 purchase advertising on account from B company to be paid in the future. So we're gonna put the vendor here, is going to be company, and we purchased advertising. And so we're gonna say it's on account. So that's 315 in the accounts payable. It's not gonna be in the landscaping supplies because it's advertising and therefore will put it into the other account. That's not one will typically break out unless we buy a lot of advertising on account. Uh, we'll have it in the other account will break it out as we enter the journal tree at the end of the month. So it's gonna be 315 and the other Then we're going to say on 7 18 purchase supplies on account to be paid in the future. So we purchased once again from L H and G, so he purchased supplies. So that's gonna be accounts payable 140 for the supplies purchased, and that will go into our standard landscaping supplies account. What we typically would be using in this type of company that being normal transaction. So those are all the purchases we're gonna record this time? Note that the purchasing journal dependent depends on how often we have purchases. If we're a landscaper and we're always, you know, recording more purchases then, as we do, more jobs than this list could be quite long, even if we do it on a daily or monthly daily or weekly basis. This is on a monthly basis, and typically it will have a standard type of account, meaning, in this case, landscaping supplies. But it is one of those things where types of journal, unlike the sales Journal, which is very specific, the purchases journal it could be purchases for anything on account, and therefore we need to have this other account and those air typically the more difficult questions from a test taking standpoint as well as in practice standpoint, what to do with this other column? How do we post that out? I've put the totals down here now and save the totals when some always up and then we're going Teoh, record them with a journal entry. So within x nine and it's gonna add these up the 581 1085 to 3 15 of the 1 40 using the some function. So we will say equals s, um, double click that some function highlight from the 1500 all the way down and enter. That gives us 1 2040 We could take this item here and pull it across, and that will auto fill. Or we can sum them up again. I'm gonna Some of them began just to emphasize that we are adding up the entire columns. So equals the sum. DoubleClick, the some function we're gonna go from the blanket column. I'm going to highlight the entire column the same section. Even though there's empty numbers here, That's OK. That's the format we want to have. If we make changes in the future, we want to be able to add something to that cell and having the formula pick it up. We're gonna be doing the same thing here to say equals this some of and double click the some function from the 1005 on down that gives us the 1008 15. Now we're gonna take this information. Let's go ahead and underline it. I'm gonna highlight this information home tab. We're gonna go to the font group and let's go to the underlying and double underline. Okay, so now we're gonna post this out, We're gonna make a journal entry recording the entire months of activity. Not too much activity this month, but tire months of activity with one single journal entry using this information down here . And we might have to break this last column out because it's in the other column and we don't know exactly which account to put it. Teoh. So we will figure that out as we go. So we're gonna say this is gonna be as of the end of the month, 7 30 in our journal entry will post the journal entry of record the journal entry here to the general journal, then posted Teoh the General Ledger and then see the effect on the trial balance. Okay, so we've got the accounts payable now. It's gonna be ah, credit account here, and we've got we've got at least a couple other debit accounts, so I'm gonna put the accounts payable in their first blood notes that, um we're going We're gonna put it on the bottom in this case, but I want to see it first, cause that's the account we're gonna use most often. So if we school over here, we could see that Accounts payable is a credit balance account, and we could see in our table we're gonna credit it. And that makes sense when we consider accounts payable being a credit balance because it's it's a liability. It goes up in the credit direction. The bad thing is going up. So we're going to the same thing to it, which in this case, is another credit. So I'm gonna copy this in age 13 right click and copy. And then I'm gonna try to put it on the bottom here. Someone I'm gonna leave a couple spaces. There's gonna be at least one like 123 accounts above it. Possibly so. 123 and put it down here in a C 19. So I'm in a C 19 right click and paste. 123 I've been going indented. We're gonna indented going to the home tab alignment and increased thean denting. Or you could double click on it space bar three times and then we're gonna go here to e 19 and I'm gonna pull over this 2140. Gonna do that with a formula instead of equals will say negative in order to flip the sign and then point to that 2140 pulling it over and flipping the sign to the credit or negative of 2140. Now we're going to the other side, which is gonna be landscaping. Weaken. Do that just with this total number of the 350. And if we scroll back over here, we could see the landscaping supplies is our supplies area. So it's an asset. It's gonna go up with a debit as we see here the debit there. So we're gonna copy the landscaping supplies, right? Click and copy scrolling down. We're gonna put that on top in a C 16 right click and paste 123 So there's the landscaping supplies. We're gonna scroll back over here and pull the number over. We want that 325 to be a positive or debit this time. So in cell A D 16 were gonna be here and pull over that 3 25 with a formula saying equals and then just pointing to that 3 25 and then enter that should pull that over. So here's our debit. So far, here's our credit. Now we only have one more number in the totals column. But it's in that others area, and we don't know which account to go to the others area. This is the most confusing component. Meaning we have to go through here and say, Well, where should these go? So we know that this 1st 1 this accounts payable portion is included here. We've recorded that in this component. What's the debit side of this transaction that happened, This transaction that happened. So it's gonna be up here, purchased lawnmower and garden tools. So if we look at our chart of accounts and say long more and garden tools, it's not. We didn't put it into the supplies, so possibly we're gonna put that into the lawn equipment on and appreciate it. So we're going cap in last one of those that were gonna dio So this number here, we're gonna put it into ah, loan equipment and then capitalize it. So I'm gonna copy that loan equipment. We're gonna debit that amount. So we're gonna break these. This total we're gonna break out be doing these two so long, equipment, we're gonna scroll down here, right? Click and paste. 123 There it is. Scrolling back up. We need to pick that 1000 up and put it right there. So within a D 17 going to say equals scroll up just a bit. Point to that 1500 then enter. So there's our 1500. Now we have one of their component that's gonna be the 3 15 also in the other. We need to break that out. That was for B cos of the 3 15 purchase. Advertising on account. So we know it was purchased it on account that the, uh, credit to accounts payable is already here. So what's the debit then? That we need to put that three. What was 3 15 to? It's gonna be something down here. It's actually gonna be an advertising expense. And this is gonna be, ah, something that's a little kind of confusing with the purchases journal, because here we're not really purchasing something. We're holding, not something tangible. We may use the purchases journal or accounts payable to pay for expenses in this case. So here's advertising expense. Its expenses, like all other expenses, have debit balances. We're gonna make it go up by doing the same thing to it in this case, another debit. So we're gonna write, clip the advertising expense. Copy it. We're gonna put that in a scene. 18. Right click and paste. 123 So there it is, And then we're gonna scroll back up, and we're gonna pick up that 3 15 here. So here we are in a d 18 we will say equals and point. Teoh that 3 15 and enter. So there we have it. We should be in balance. If we highlight these three adds up to 1 2040 which is equivalent to the credit of 1 2040 Or if we add up the whole thing, this down here and over it should add up to zero. So we've broken this out here, here and here, into these components and and recorded in which there's the 1 2040 Ah, And here is the ah, the 3 25 And in the 18. 15 its course of these 2 1008 15 Okay, so now we have our journal entry. We're gonna now post that to our general are General Ledger and then that will be used to generate the trial balance. OK, so here's our landscaping supplies. That's our 1st 1 We want a post. Here it is on the trial balance. It's like, what? The third accounts down. It's gonna be in the same order on the general ledgers that we have cash. We've got the accounts receivable and landscaping supplies were gonna be down here in a K 23. So within a 23 landscaping debit side, we will say equals and then pointed to that 3 25 bringing the balance up from 0 to 3 25 There's the 3 25 year. If we scroll back down now, we're indeed lawn equipment. So there's the lawn equipment. Here's the lawn equipment here. So it's what, like 12345 6/7 account. So 123 4567 Here it is that loan equipment in A S nine. So within a s nine, we're going to say equals and I'm gonna use the arrows this time scrolling to the left and then scrolling down. And there it is that 1500 enter. We could also do that. If you double click on it, it's it's equals 80 17 and or type in the 1500. Then we've got the advertising expense. Here's advertising expense. Here it is. Down here on the trial balance, it will be in order assets, liabilities, equity revenue and then expenses. So we're gonna find that over here to really get them assets and green liabilities in orange equity and light blue. And then the revenue and expenses were looking for advertising. Here it is in B E 21. So be 21 gives us this advertising debit side here. We're gonna do this with a formula, so I'm going to say equals and I'm gonna use the left arrow and scroll back over here and see if we can find where that amount is. So here it is. There's the advertising. There is the amount 3 15 in a d 18 and and her so that gives us the 3 15 in advertising once again you could type it in, their formula would be better. I highly recommend practicing that or you can type in equals a D 18. If we had everything formatted the same way on the same lines, enter. Then I'm gonna scroll back over. And that 3 15 there should be in advertising where still not in balance were out of bounds by the amount that will be reported in accounts payable. So that's what we're gonna do. Now we're gonna record the accounts payable. Here is a council stable payable in the journal entry. Here it is on the trial balance. We're gonna record that to the general ledgers. They first Orange account that first liability account and therefore will also be the first Orange account First liability accounts. Indie General Ledger. So we got the Green Accounts assets, and then here's our first orange account. So we are in a T 21 so 80 21 right at 21. So we're going to say equals and use a formula and scroll back over to find that amount. There it is. 2140 enter now. Once again, you could type it in a negative 1 2040 or just put equals e 19 and enter and should pull that over that amount then should show here on the trial balance and should put his back in balance. And that's the recording of these accounts now. No, we also recorded something to the accounts payable, and therefore, we also need to know who we're gonna pay. In other words, here's our accounts payable, showing we owe people 2140. The next question is, who do we owe in order to know who we Oh, we need to track this by a subsidiary Ledger and we're gonna have on accounts payable Subsidiary Ledger tracking by vendor. So that's what we will do now. Athletes, go back over here. We're looking for thes accounts. We're gonna record them again in the subsidiary Ledger. So another In other words, we're gonna get to the same number, but break it out by vendor in the Subsidiary Ledger. So 1st 1 will be this item. That's what we're looking for. I had I just still don't get confused. It's in l h and G. So if I scroll back over and scroll back down, we got that surface. So here's their subsidiary Ledger. Here's uh oh. H and G were in A S 20 are 32 A as 32 it's on and we want to be on the credit side. So it's on a T 32. We need to credit now. It's a positive number over there. I want to show it as a negative or credit number and the credit side. Therefore, instead of hitting equals, I'm gonna put negative and then scroll back over, just like it wasn't equals but a negative, because that'll take the number and flip the sign so we're gonna scroll back up, not there. That's not what we want. Want that green one? That's way over here in x four x four and enter. So you could put a negative. You could type in a negative 1580 32 or equals a negative, explore or just negative explore and enter scrolling back over which other? What else we got here? We're gonna say that now we've got the 1 85 for a company, so I'm gonna scroll back over to our sex injury ledger. We're gonna look for the a company. So here it is. Notes were out of balance, of course years. That means it's not tying out to the tribe bounce or General Ledger. So here's a company. So we're in a X 32 a x 32. We're gonna flip the sign once again. So instead of hitting equals, I'm gonna put negative scroll all the way to the left and then back up. And there we have the 1 85 and enter. So there's that, So that will be included in our total. Here, we're gonna scroll back over and do this two more times. So now we've got the one or the 3 15 for B company, So it's scroll back over for B company Scroll back down. Here's our subsidiary Ledger and here is be company. We want to be on the credit side. B company were an 80 42 80 42 rather than equals. We're gonna put negative scroll all the way to the left scroll up and we're gonna pick up that 3 15 We're picking up that 3 15 and entered. So there it is on the 3 15 b company owes is 3 15 You could type in equals Negative x six to pull that in note. This is summing up. Now all of our subsidiary ledger accounts We're still out of balance until we record the last one, which hopefully will put us in balance. That will be for the 1 40 And that's for L. H and G. So we're gonna scroll back over here. We're gonna find L H and G scrolling back down. We have one in there were in 80 32 80 32 instead of equals, we're gonna put a negative scroll to the left to find our mount Scroll back up and put that 1 40 that last amount and enter once again, you could put a negative 1 40 here, or you can put in equals or just negative x seven when she had enter, Excel will put the equal sign in there. So there we have that. And if we some if we add these up, then we know that l h and G we owe them 6 1040 We owe a company 1 85 and feet company 3 15 for a total 1 2040 which should match. What is on the trial balance 1 2040 And, of course, what is in the general ledger 1 2040 So that's gonna be the purchases journal. Note that when we do the purchases journal, this is gonna be the most confusing component. When you see the purchases journal anything that deals with accounts payable well, you know when accounts payable is going up were typically going to be putting into the purchases journal at that point in time. Anything that is a purchase but is purchased with cash, on the other hand, will typically go into the cash payment journal, not in the purchases journal. So that name can be deceiving. Just as the sales journal can be a little bit deceiving because it's really a purchase on account accounts payable and the sale journal is a sales on account, dealing with accounts receivable, not dealing with cash 9. 80 Worksheet Purchases Journal Inventory: in this presentation, and we're going to take a look at a purchase journal. In this case, they purchase journal dealing with inventory as the primary purchase that we will be making . We're gonna use the information on the left side. We're going into that into the purchase journal here. Then at the end of the month, we will record the journal entry related to the purchases for the entire month in the general journal, taking that information and posting it, then to the General Ledger that General Ledger then being used to generate the trial balance. So remember that this is going to be something we will use and more of a manual type of system to set up the purchase journal if we had an automated system. It still is useful to know this information because we white want to generate reports in a similar fashion and know how different types of accounting systems would work. One of the similarities one of the differences in different types of accounting systems. Now here we're gonna deal with the inventory. So a company that has inventory, then the major purchase would probably be then inventory. So we're just gonna demonstrate the inventory type of purchases here, and that's gonna be our primary account. Note that when we have purchases, it really kind of is the accounts payable journal that we're dealing with. If we made a purchase for cash, in other words, it would not be in the purchases journal but in the cash payment journal. And also note that there could be other things that go to accounts payable that aren't strictly inventory purchases. However, when we're dealing with accommodate that, that has inventory. It could very well be the case that most of their purchase items will be inventory, and that's what will demonstrate in terms of the purchases here. So we're gonna say, first on 75 we're gonna have to name the vendor L, H and G here because we need to track it in the Subsidiary Ledger, and that's the main thing to keep in mind. Then we're just gonna record that amount one time. That's what saving us time by recording it here rather than having to two transactions or two accounts affected, posting it and creating the trial balance from it each time. Well, just record it into this one time here one area that representing that should be 1500 That represented a debit Teoh inventory and a credit to accounts payable. It hasn't been recorded yet. Of course, we will record it at the end of the month. Then we're gonna have on 76 All right. We probably shouldn't do the subsidiary. I will do the subsidiary Ledger as we go here, since the Purchase Journal is gonna be related to the subsidiary Ledger so we won't post it to the General Ledger right now. We will post it to the subsidiary Ledger. Four accounts payable represented who we owe. So we know who we need to pay at a later time. The subsidiary Leisure is gonna be down here. So it's down here to the right. Here it is. The subsidiary Leger. We are in L, H and G. We want to be on the credit side, so we're here in a Q 32 8 Q 32. We're gonna do this with a journal entry equals I'm gonna use the arrow, so we're gonna go left. We're going all the way left here with the arrow's gonna screw up, and we want to pick up this 1500 enter. Now, that is Ah, lot of scrolling. Note that we also need it as a credit here, so I'm gonna double click on it. I need to flip that sign to make it a negative. So we're gonna double click on it. I'm gonna go right before the W orbit for the equals and hit negative. And that'll just basically multiply times negative one or flip the sign for credit. So we want the brackets around it. Now, you could type in just a negative 1500 here. I do recommend using formulas and maneuvering around the worksheet. It is possible also to just enter equals negative w four and enter. Okay, so that amount plus what is in these other vendors adds up here. It's red currently because that amount does not match what is on our general Ledger or our trial balance. It won't until the end of the month when we enter this data to that to their So the next one, we're gonna say a company and 900. So we're buying more inventory this time. We just bought 900 of inventory that represents the debit to inventory and credit to a payable. We're not going to record it now into the General Ledger, but we will record it. Teoh, the subsidiary Ledger. So we're gonna go to the accounts payable subsidiary Ledger once again. And I was a company, I believe. I hope that's what I'm remembering. So, a company. If we scroll down, we have accounts payable subsidiary Ledger, a company debit side, or we want to be on the credit side. We're gonna be here than in a u 32 au 32. We're gonna do this with a instead of equals. I'm gonna select negative so that when we pull that over, it'll flip the sign. Note. It behaves like an equal sign. When I go left, it looks just like an equal. It's just going Teoh, take this information and flip the sign. I'm scrolling up to find that information. We want this 900. It's in w five, so enter once again we could just type in a negative 900. But I recommend formulas if we also could type in equals negative w five or just negative. W five XL will just put in the equals as it did here. And of course, we still are not going to be in balance. In other words, it's not tying out to what is on the trial balance until we do the journal entry at the end of the month. Next one, we're going to say on 78 we have being company, and that's gonna be 4 700 So be Company 700. Here's the 700 we're gonna post at once again to the subsidiary Ledger. So I'm gonna scroll to the rain. We're gonna scroll down finding our subsidiary leisure. We're looking for B company. So there's a years be it on the credit side, we want to be in credit side a Q 42 in a Q 42. So instead of hitting equals, we're gonna put in negative because we want to flip the sign, gonna scroll to the left and we will screw up looking for that amount that we just entered that 700 there it is in w six, w six and enter. So it took that that 700 flip The sign made it a negative. We could just type in the negative 700 or we could type in equals or just negative w six and enter. And that will be it. If we add up. What's in our accounts? Payable accounts. It's still not in balance with what we have in the trial balance. So we'll keep going here. Next one we got it won't be until we do the entry. Of course, at the end, 7 18 We've got, uh, l another l h and G 300 300 there. So we're gonna post this once again, Not to the general Ledger, but to the subsidiary Ledger. And then we will do the journal entry for the General Ledger School and devote to the right , going down looking for our subsidiary Ledger. We're looking for L h N g. This account, it's gonna be on the credit side going up once again. We're gonna go to the next available spot in a Q 33 Q 33 instead of hidden equals. I'm gonna put negative to put this formula, Then scroll left to find this information scrolling up. And we want to pick up that 300 this 300 dater in W seven inter. So there we have it. So now L h and G was, we owe them 1800. If we add all this up those three accounts, that adds up to this 3400 that then doesn't match what is on our trial balance in the accounts payable. And, uh, it won't until we do the journal entry, as we will do now. So we're going to sum this information up and then do the journal entry, so we'll put an underlying here first. I'm gonna say Home tab just for the formatting purposes of it. Font and underline. They were gonna put the total here, so we'll say total. And then we'll sum this up. So I'm just going to sum up these columns. So we're going to say equals s, um and will sum up the 1500 down toothy 300 and enter. So that, of course, just said 1500 plus 900 plus 700 plus 300 gives is 3400 gonna do the double underline here by going to the home tab. Font group underlined, but we want the double underline. There's the double underline. Now we're going to our journal entry related to the purchase journal for the entire month and then post the entire month worth of purchases. Teoh, the general Ledger that then being used to create the trial balance. So we're gonna say this on 7 30 Ah, and we will say that we are going to do this journal entry inventory has been going up even buying inventory on account. So for accounts payable. So here's the inventory. It has a debt. What should have a debit balance? It doesn't because we did the purchase journal, the the Sales journal. First, we, in other words, recorded the decrease due to sales before recording the purchase journal. But we're doing both of these as of the end of the month and typically inventory as a debit balance and should be going up now in the debit direction and therefore we do the same thing to it. Another dead it. So we're gonna copy this inventory. We're going to paste this in Z 11 right click and paste 123 So, in other words, this this inventory looks really funny right now because just because we're recording all the journal journals into the General Jet General Journal at the end of the time period. And we did the sales journal before that purchase journal. This will flip to what? It should look normal, as which is a debit balance once we record this amount. So we are in a 11. I'm gonna pull this number over. We will do that. I'll do that with a formula equals that 3400. Then we want a credit of the same amount of gonna do that with a little formula, that being negative of that number. And we'll just take that number, flip the sign, putting brackets around it. Now we just need Teoh put the account here on what that's gonna be, and that's gonna be accounts payable. Remember, we didn't pay cash. Cash didn't go down to buy this inventory. We put it on accounts, accounts payable. The liability liabilities have credit balances. We need to make it to go up by doing the same thing to it's another credit, someone of right click and copy accounts payable. We're gonna put that in Z 12 right click and paste. 123 That's indent. That so I'm gonna go the hometown alignment, increase inventing, or you could just double click on it space for three times. And there's our journal entry. So we have this. We're gonna post it now to the General Ledger. So here's the inventory account that we need to post here it is on the trial balance. Edel's What is it? The third account on the trial balance. So it's gonna be the third accounts on the general ledger. So cash accounts receivable inventory. So we're gonna be in H 24 se equals, and we'll scroll back up just a bit and pick up that 3400 in a 11 and enter so once again, you could type it in there. But I highly recommend formulas in this case, for sure. And if you double click on it, it says equals a 11 formulas really help if there's a problem, because we know where that came from. So if something's out of balance, we can tie it out a lot easier with formulas. And then, um, accounts payable is here. Accounts payable is here on the trial balance. The first Orange account first liability account. It will also be the first orange or liability count in the general ledger. Here are all the asset accounts. Here's the liability account We want to be on the credit side. So we are in a Q 21 a Q 21. We're going to say equals and scroll to the left, and we're gonna pick up that 3400. No, we don't need to put a negative here in front of it because on the journal entries, we made that the credit a negative here. So whenever we post something to this general Ledger, we don't ever need to put any negatives. It should be done here as we make the journal entries and enter. And so there we have it. 3400. That 3000. And it could you could just type in negative 3400 or equals a B 12 and should pull that over. Um, although I I recommend formulas. So if we scroll back over here is the 3400 on the trial balance, we're back and balance debits equaling the credits. Note. There's no effect on net income as we post this because these are the purchase of inventory , not the sale of inventory. We're gonna record it as an asset, capitalizing it innocence. And then we record the sales component, as we did when we did the purchase journal in the form of cost of goods sold. So our transaction here that we did this time did not affect any of the income statement accounts. It was affecting inventory, which will be an expense at the point of sale in the form of cost of goods sold. If we scroll down here, we can also see that we will. Hopefully I'm hoping that this turned green because now this adds up to 3400 in the subsidiary Ledger. In other words, of the 3400 we owe. This is who we owe it to l H and G 1800 a 907 100 to be that 3400 then matching what is on the trial balance and matching what is in the General Ledger accounts 10. 90 Worksheet Cash Receipts Journal: in this presentation, we will inter date it into the cash receipts journal related to cash receipts. The information will be on the left side. We're gonna enter that information into the cash receipts journal here. And when we sum up that cash receipts journal at the end of the process, we will then have a journal entry in the general journal that will sum up the activity. For in this case, the month that will then be posted to the General Ledger. Is being the General Ledger finally being posted to the trial bounce or using the General Ledger to create the trial balance? After that process, scrolling back to the left we looked past at the sales journal, the cash receipts journal will be a bit more complex because the sales journal is very specific, meaning we're only gonna be recording stuff. That's a sale on account Cash receipts Journal will often be very specific, depending on the type of company, but can be more abroad when we think about the cash receipts journal in general. In other words, if you're using a cash receipts journal and it's a process where we're gonna do it more by hand, without an electronic system. It's possibly the case because we're gonna make a lot of sales for cash, and therefore we're gonna have the cash receipts journal, which will basically be sales and cash. And that would be a pretty straightforward sales journal. But anything that is a cash collected chin will be a sales receipts journal. And of course, there could be many other things other than a sales process for a cash collection. So typically, we would think for sales Journal as the receipt of cash. Any time we get cash, we will record it here. Usually those will be, hopefully, sales for cash or the collection of cash after a sale has been made on account, meaning the collection of accounts receivable. There are many other things that could result in the sale, however, and we'll take a look at those as we go. So this problem will list a lot of different transactions other than these two main transactions, so that we can see what other types of things will be there. Those air, typically the more complex types of things that can cause problems when doing attempts question and in practice. So remember that the journals are used. If we don't have a sophisticated A system that we can use it something like a journal to record the activity for a month, saving the time of us, recording each transaction with a debit and credit as we go posting them. Creating the trial balance as we go in this case will do that at the end after we've record everything. If we do have an automated system, it's still good to know what the cash Receipts Journal is because it were often wanted print reports in a similar fashion. A report from a computerized system in a fashion that would be similar to a sales receipt type journal. It's also just good to know different type of accounting systems. What could be similar? What will differ when we have different systems, so we'll start with 71 We've got the owner deposits money into the business bank account, so the owners putting money into the bank account. This is gonna be more of a description account, and if we are doing something with accounts receivable, we want to list out the customer there. Otherwise, we're gonna put some type of extra description here, so it's gonna be the owner. It's gonna be putting the money in and another explanation. We're just gonna put owner investments and we're going to say the amount of debit. This is always gonna be column that will be used in the cash Receipts journal because the deputy cash is what we're doing here. It's It's a cash receipts journal. Therefore, we will always have the debit to cash. Typically. Then we will have some other credits. I'm gonna put the 3000 here. Typically, we will have some other credit, and that will be it. If there's only two accounts involved, however, it is possible that we have more than two accounts involved in this case. We only have to. The other is gonna be the owner capital account Now. We don't have that listed here because it's not common that Owner Capital would be a cash receipts so typically will have something like an other account, and we'll have to break that out at the end. Would we make the journal entry meaning, go through the other accounts and break them out to the proper place during the journal entry transaction? So the other side's gonna be a 3000 to the credit in this other section. Now, we're just gonna keep doing this until we get to the end, then will sum this up. So we're going to say the next transaction 71 borrowed money from the bank so we could say that it's gonna be the bank. We might list the bank out there. Gonna be a next KLA nation, Possibly bank loan. We took out the amount that we got 16,000 for the cash. So that's gonna be the cash and note that I'm just tabbing through here to move to the to the side for excel purposes and then the other side of it, once again is not our normal transaction. It's not gonna be the Sails transaction. It's not a cash receipt for a sale made in the past and getting the receivable. Therefore, it's gonna go into other again. The credits gonna be going to other will have to break it out later into something like loans payable. So eight thousands gonna go into other. That's the two sides. Note the debit and credit basically reflected here with the two transactions, but not in a debit and credit journal entry format just in more of a list format. Then we're gonna go to 79 and we're going to say that receive cash for work that will be done in the future so we could list the name here. We don't have the name there, so we're gonna list the account, which will be on earned revenue. So instead of listing the name of the customer will put under and revenue, we don't necessarily need the name of the customer here because we already received the money. So we're not gonna collection. We don't need to put it in Subsidiary Ledger. However, uh, you know, obviously we do need to track who we need to do the work for in the future as well. It's gonna be advanced payment or payment in advance of the work being done, and that's gonna be a liability. 360 is how much we got and this again for normal transactions. This is probably going to be something that's not normal for most businesses. However, if we're in a business that, like, sells tickets to a concert or something like that, then every ticket sale we get would probably be going to under in revenue and therefore we would have another column for unearned revenue. But in our case, we're going to say that our normal transactions aren't such that we get paid before we do the work. That's more of a specialized industry that's somewhat unusual for most industries. So we're gonna put that once again into the other credit column. Next, we've got 7 27 20 Ah, completed job for s company received 250 well received 300 at a later date. So this time we're gonna put the name here. We're going to say this is s company, and we're gonna say that explanation is it's a sale. So sales is what happened, and we re got cash. Now we got 250. The problem here is that we got 250 of 34 550 we're owed the other 300. Now, if you see this, you might say whom this should go in the sale journal because we made a sale. But any time we get cash were typically gonna put it into the cash receipts journal and the sales journal will only be used for sales on account sales for accounts receivable sales that we have not gotten paid yet. Four. This case we got paid partial it and we have accounts receivable component. So this may not always be in ah, problem that will be in a cash receipts journal, But it's one to take a look at and the idea here being Any time we get cash receipts, it's going to go in the Cash receipts journal. So even though it's a sale here, even though there's two accounts affected, well, put it into the cash receipts. A journal. Now the other side of this transaction is going to go to partially. Sales is going to be the credit that's gonna be for all of it, the 300 plus the 250 so I could put a ah Formula 300 plus 2 to 50. That being the 5 50 now, we can't put the accounts Aceval in this column because that's a credit and we're not crediting accounts receivable. We're actually debuting accounts receivable. This column would be used if, for example, we got the 250 on payment for a sale made in the past due to us that then being in accounts receivable and this account case accounts receivable, it's gonna be going up with a debit, which we don't have here. Therefore, it's gonna go into the other account, so this will be the 300. So the debits and credits a debit 252 cash debit, the other account accounts receivable once we break it out and then the credit to the sales . So once we some all these columns up, well, record this journal entry as one transaction for all of this data. Next, we're gonna have 7 27 We said complete a job for l company Invoiced 700. Received 200 account to be received in the future 500. So, same thing we're going to say this is gonna be for L company. And because we got cash, it's going to be in the cash receipts journal rather than the sales journal. Although it is a sale that we have made, uh, the amount of cash that we're gonna get is 250. The sales amount is going to be the 2 50 plus the 3 50 or the 700 and then we're gonna put the other not into the receivable, because that's a credit, but into the debit amount for the receivable. And that will be for the, uh, 500. So once again that the transaction being we got 250 cash debit cash, we got 500 accounts, people debit accounts receivable. Credit the sales of the 700. Let's look at that one more time. Actually. Have the sale of the 700. If we received only 200. 200 here, and then we've got the 500. So we debit cash, we got the 200 we're going T debit, the accounts receivable for the 500 that is owed to us. And the sale we made was for 700 as to credit. All right. Next one, we're going to say on 7 27 uh, received cash from in company for work done in the past. So we did work in the past. So once again, we're gonna name this out. This is M company. Not very creative names, but that's our customer who that's who worry are getting the money from. And this is gonna say we we receive cash on account or we receive cash for work done in the past. Received cash are in relation to accounts receivable. So we're going to say that this is going to be 7 27 We got received cash from M Company 150 . So we'll put that here 150. And this time it's gonna go into this accounts receivable because now we received the cash at this point in time. So we're gonna put the 150 here and accounts receivable, crediting the accounts, etc. We'll bring it back down. That being the normal type of thing you would expect to see in the cash receipts journal, So then we're gonna say 7 30 I received cash from P company for work done in the past. So same type of idea we're gonna put here P company. That's what we got the money from, and it's gonna be the same ones. I'm just gonna copy this. I'm gonna right click and copy and paste 123 where we can paste either way, really right there. And I'm going to say it's the 425. And once again, this would be the more normal transaction if we are in a type of business where we invoice people first get paid later then typically, we would have the debit going to the 4 25 cash the credit going to the receivable. And this column would probably be the most normal column for that type of business. Then now we're going to sum this up, so I'm gonna talk. Put the total down here, will skip a line this time Skip line this time so we'll total this up. So I'm going to sum up this column and then just sum up all columns. So we will say equals s, um DoubleClick. The some function and highlight this entire column 3 3000 all the way down. So we're just adding that up. So that 3000 plus 8000 votes of 3 53 60 to 5200 150 in the 4 25 kids SD 3 12,085 We can pull that across notice. See, if you put our cursor here and pull that across, it will sum up the rest of the columns. I'm gonna do it one by one, just to emphasize we're doing the same thing someone say equals the s, um of this column. I'm gonna some of the entire calm, Even though there's no numbers up there, I'm not just going to stop here just because if any changes happen, it's just good practice to sum up the entire column. So we're gonna say, OK, there's that will do that all the way wrong equals some. And we will sum up this entire column and two more times equals s, um, DoubleClick. Some function. Highlight those columns and one more time equals some of these columns. So I'm gonna double underline this. Now, I'm gonna highlight thes column, these numbers and we're gonna go to the home tab. We're gonna go to the fonts group. We're going to go to the Underline and a double underline. So that's what we have here. These are our bottom line numbers, So that's her cash receipts journal. We've recorded the activity related to receipts of cash for the entire period the entire month. In this case, we could do it for a day, a week, a month. We have forced did it for the month. In this case, we don't have a whole lot of transactions in this case, if we were talking about a type of company that has a lot of transactions on a daily basis , especially if they were transactions that were just basically getting cash and sales. A journal like this can be very helpful on just record this information very quickly. So now we're just gonna do one journal entry Teoh, post this out. So we're gonna go over to our general journal and construct a journal entry as of the end of the month. Recording this all at one time. So 7 30 first, we're going to say we got cash. We got cash for this. 3 12,085 We know if we look at the trial balance, cash is a debit balance account. It's an asset accounts. We're gonna do the same thing to it. Which in this case, will be another debit someone a copy. Checking accounts up here. Right? Click and copy. Gonna pace that. 123 and C eight, Right Click and paste. 123 Just the format. We could type it in there. I like pacing and they're putting the formatting in there. Next we're gonna have the accounts receivable is a credit. So Let's build that. Go back over here counts, people. That's our second account. It has a debit balance. We're going to the opposite thing to it. Credit team it to make it to go down. So I'm gonna copy the accounts receivable. Gonna put that underneath, right Click and paste. 123 values only. We could indent as well. Home tab alignment and increased Thean dent or double click and space bar three times. And the amounts here. We should put the amount in the checking account. This is 88 is gonna be 12385 Make this a little larger so we can see it. And then we are going to have the credit here of I'm gonna put a negative 575 and there's our credit. Then we're gonna be sales. So here's the sales amount. It's gonna be a credit, as we can see, if we look on our trial balance, here's the sales that we're gonna call it revenue down here. It has a credit balance. So we're gonna do the same thing to it, which is another credit increasing sales. Increasing resident revenue as normally, is the case. So when a copy. This gonna put it in a C 10. Right click and paste. 123 Gonna go to the home tab. Alignment. Increasing Dent. Now, note that the sales account could be called sales. It could be called it could be called revenue. It could be called income sales. Is torpor typically used for a merchandising company? But it's also often going to be something that we use for these types of journals. We have the sales journal, so we're calling it the sales account here, and then we're gonna have the other account. Now, here's the complex account. Of course, because we can't just take the total for the other account because we don't know which account this is where we just put other numbers and because we didn't have any other column to put them to. So we have to break this out one by one, line by line. So we're gonna start with this 3000. Say that 3000. There is an owner investment. So the owner investment. If we scroll back over here, we're gonna say that the owner investment is capital that was invested. So it's gonna obviously be a credit here So And capital is a credit balance account representing what is owed to the owner week over the owner. More because the owner put money into it. And therefore it should go up by doing the same thing to it. Another credit. So I'm gonna copy that right click for capital copies. Put that in a C 11. Right click and paste. 123 I'm gonna go to the home tab Alignment increase in denting. And there we have that. Now I'm gonna add that revenue, which I didn't add before for so we had the accounts receivable. The sales is here. That's gonna be this amount in the sales. That's gonna be a credit of 1 to 50 And we could pull this over to Let's do this again. Let's do this with formulas. Delete this. Just a show of formula. If we were in a D, uh, eight, we could say equals and point to that 3 12,085 Now, if we're in e nine, we want to make this a negative, and that's a positive. So instead of hidden equals, I'm gonna put negative and point to that 5 75 and that'll bring over the 5 75 and flip the sign then in the revenue we want to bring the revenue here, which is sales. And once again, we want to flip the sign. So instead of equals, we will say negative and point to that 1000 to 50 and enter. And then we've got now the capital. We're gonna put this 3000 not the total, because we have to break this other account up one by one. So we are in a 11. We're gonna put negative of that 3000 and enter next one. We've got the 8000 here, and that was for a bank loan. So we got 8000 for a bank loan. What will be the other side? We got the cash. That's what was recorded. It's included in this number, and then the other side of it is going to go to some kind of notes payable or loans payable to the bank. In this case, we've got accounts payable, notes payable, interest payable. It looks like the notes payable will be the one. It's a liability. It needs to go up by doing the same thing to it. Another credit in this case, someone copied out. We'll put that in a C 12. Right click and paste. 123 then home tab, Alignment, increase in Dent. And now we are in a E 12. We're gonna pick up that 8000 so we will say negative instead of equal point to that 8000. Bring it over. Flipping the sign. There we have that. That one has been completed. And the next 1 360 Where was that from? Unearned revenue. So unearned revenue. So once again, we know the debit. The debits included here that 3 60 is included in this 3 12,085 What's the credit? It can't go to revenue because we had not yet earned it. Instead, it's going to go to unearned revenue. Unearned revenue being the credit at this time, it's a liability because we owe it in the future. So we're going to say under in revenue. Copy that and paste that in a C 13 right click and paste. 123 Then home tab alignment, increasing Dent. And we're gonna pull that number over. I'm in E 13 instead of equals. Negative. Pointing to that 360 enter. So there we have that amount, and that is done. Now we just have this one notice we're not in balance here because the credits, if I highlight these are at 13 1 85 where the debit is at 12 3 85 If I highlight the whole thing, it's $800 off. Which is, of course, this 800. So if we scroll back over them, we need to pick up this 800. Now, these two remember, we're from these two sales that had both a cash component received as well as an accounts receivable. So these two, we can use the 800 because they're both there for the same purpose accounts receivable being debited in this case. So we need to debit to accounts receivable. So what happened here is is this 3 12,085 is included in the cash number? Includes these two cash numbers of to 50 and 200 and then the sales over the revenue of the 5 15 The 700 are included in this number, and now we need to put the other component this 800 which we will put into accounts receivable. So here's accounts receivable. It's in h six. I'm gonna copy that. Right click and copy. We're gonna put that in a C 14 right click and paste. 123 And this is gonna be a debit. So it's a debit here. That's what we need to be in balance 800 or I could say equals and then points to that 800 enter. Now note that this isn't We don't have the two debits on top here, so you might want to reposition this to put the two debates on top. If you're concerned about the formatting of of it in terms of the journal entry, it's not a big concern in terms of posting or that the functionality of it. And sometimes when you have complex journal entries like this, it may be better to have them out of order in order to have them in compliance with what's logical, to go back to and see where it came from, in this case, in order of it from the cash receipts journal. So that's that's ah way weekend record All this transaction This is one of the more complex journals and of course, we have more transactions here. And that's why we have to make a longer journal entry to post this out at the end of the day. However, ah, lot of cash receipts. Journals probably are only gonna be dealing with accounts that are just sales types, transactions or receipts of cash transactions. That's what we would expect to see most if we saw a lot of activity for the month for a particular type of business using this type of system. So we're gonna post this out now. But the other types of transactions, of course, of the more confusing ones. So we have to touch on those transactions. So now we're gonna post this out. So we've got the cashier, So cash is the first account. We're going to post this to the general Ledger over here, the general ledger. So here's the cash count. Here it is on the trial balance. It's the first count on the trial balance and therefore the first account in the General Ledger. We're gonna be down here in a K nine, a canine we will say equals and then point to this 3 12,085 and enter. And that will bring down the 3 12,085 and post that out. We see it here in the cash receipts journal as well. No, you could type it in there, Azat hard coded number. But I would rather much rather see the formula here. You could also put equals 88. As long as you have everything lined up in the same columns and sells as is here. Next, we're gonna have the accounts receivable. Here's accounts receivable. We need to post it to of the accounts receivable account here. Thes second accounts on the trial balance. Therefore the second account on the general ledger. So the General Ledger, this is a credit. So here's accounts receivable. Where on the credit side, here's accounts receivable here, a e nine. So we're going to say equals and appoint to 89 or the 5 75 credits and enter So this accounts receivable, then going from 2070 down by the 5 75 to 4 1095 Then we have revenue. So here's revenue. Here's revenue here. So it's gonna be the first blue accounts gonna be in the same order on the General Ledger Assets liability equity and then revenue. So we will scroll over to revenue. So I'm gonna go. Assets are first liabilities equity, and then the income statement accounts, revenue and expenses. Revenue is here in B B 23. So within B B 23 I want to say equals. And this time I'm gonna use the arrows so we could use the scroll bar and go back. I'm gonna use the arrows and notice It just keeps changing until we stop and hit. Enter. So where is gonna use the arrows and go up and find that? So on a e 10. So 80 10 we're pulling this all the way over. If I put inter now it pulls it over. Now, once again, you could go all the way over here to be be 23 just hard code a negative 1000 to 50 or type in equals e 10 here. And it will update this. This cell, I do recommend maneuvering around and excel. However, eso this is 3320. If we scroll back over here, we see the 3 3020 here, so that looks good. Next, we're going to be recording the capital account. So here's the capital count here. Here's the capital account on our trial balance. So it's the first light blue accounts. It's in order, assets, liabilities and equity. So we're gonna scroll back over assets and then liabilities and then equity. Here's the capital. It's a BB on nine. So we're in BB nine, We will say equals, screw all the way to the left and we'll go back down to that capital. There's the 3000 in a e 11 and enter. So once again, you could just type in negative 3000 or equals ae 11 pulling in that 3000 schooling back over. We see that 3000 in the capital account here, of course, were out of balance. Until we finish this process, then we've got the notes payable. So here's the notes payable here. Here it is on the trial balance. Second orange accounts second liability account. It's in the same order on the general ledger assets and then liabilities. So we want the notes payable right there were on the credit side some and sell a x nine a x nine. We will say equals and then I'm gonna scroll left and find this again. Something just scrolling left. And we're just posting this 8000 there into the credit side and enter. So there we have it. So there's 8000 here. It's going up. You could type it in there or put in equals 80 12 that 8000 then also being on the trial balance. I'm going to keep going down. We got the unearned revenue. Now, here's the under revenue that we need to post Here it is on the trial balance, the last Orange account. It's in the same order on the general ledger, So its assets and liabilities and in the under in revenue, we are in the credit side. So we are in a x 21 x 21. I'm gonna put equals and scroll back over, and I'm gonna find that amounts that 360. There it is and enter. So we pulled over that 360 scrolling back over here is the 360 on the trial balance. Now we're just gonna record the accounts receivable. Ah, the other side of it, the debit to accounts receivable. So that's our second account once again, and so we're gonna go to the second account on the general ledger right here. Here's accounts receivable in a K 18 and we will say equals and point to that 800 and enter . So once again, you could put the 800 there or a D 14 count's evil now at 2000 to 95 matching what's on the trial balance. We should now be back in balance. If you're not in balance, go through the trial balance and check them off to these numbers and then go to the related General Ledger and see that these have been posted to the General Ledger as they should be and make sure that the signs are going the correct way So you can see where these air all posting out This little function up here. You may not be able to use it if it's if it's locked, but it's a nice feature to knew about. So it's in formulas. Here it is. I just put him into my quick ribbon, add to the quick ribbon, so that's why they're up here. But they're in the formulas and this item. Okay, so now there's one other piece here. We've added activity to the accounts receivable account here. And therefore, we also need to back that up with the subsidiary Ledger down here. So in other words, the accounts receivable now shows that people owe us 2295. But we also need to know who owes us that money and therefore break this information out by customer. So that's what we're gonna do down here for the new transactions. This is summing up all the customers we have. It's red because this 2070 does not equal what is currently in the General Ledger or on the trial balance. So what we're gonna do is record this new transactions we had here. So remember, we had these two sales that and this other account went to the subsidiary Ledger and then these two to the accounts receivable. So we're gonna start here. We got the 300 I'm gonna say when it start here will make that green. And we're going to say that we need to record this. This was four. Who's the company s company? As company. We've got 300 debit to accounts receivable, so we're gonna go back out here. We're just gonna redo this information by customer. So s company is gonna be here. So we are in a 0 33 Gonna do this with a formula by saying equals, scrolling over screwing up, and we will find our amount. And that's gonna be this 300. So there's as company. We're looking for that 300. So there is that. So now, as company owes a 725 that's increasing our total down here, we'll do the same for the rest of these, the next scrolling back over the next. This is 500 in eight gonna make that green. We want to go to the subsidiary for L company and add the debit of 500 scrolling back over . We're looking for El Company, So here it is. We want to be on the debit side. So we're in a K 47 we're gonna say equals squirrel left. Screw all the way up and see if we can find this amount, which is here. So there's the 500 debit and enter. So that's increasing l companies by the 500 increasing our total scrolling back over. Scrolling back up. Now we need the 1 50 the, uh, for 25. And so this is gonna be in company, and this is gonna be a credit. So this is what we got back. So we got the money, and we credit What is what? The receivable representing that. That 1/50 no longer over to us. So scrolling back over, scrolling back down. We're looking for em. Company were on the credit side in a p 41. A p 41 equals scrolling all the way to the left scrolling up. We will find this 150. So there's the 150 in canine. And enter note that you could be typing these in here, uh, on. And this one actually needs to be a credit as well. Someone double click on it. I'm going to go to the end of it and put a negative sign to flip the sign and enter. So we're flipping the sign there so you could put a negative 1 50 Or you can put negative or equals negative canine, and that should pull over the 1 50 Bring the negative, pulling the balance down from 500 down by 1 52 3 50 All right, we got one more. We're not in balance yet. Here. We should be in balance after the last one. Hopefully. So we've got the 4 25 that's gonna be in peak company. So we're gonna credit P company strolling back over. Scrolling back down. We're looking for P company. So here it is. We are in a l 34 rather than hitting equals, I'm gonna put a negative scroll all the way to the left, strolled back up. And we are looking for that for 25 there. So it's in key 10 and enter. So we are here in a l 34. Double clicking on it. You could put a negative K 10 to pull that over equals negative. K 10 either will work, bringing the balance from 1 1045 down by 4 25 to 7 20 then our total. If we add all these up, it's gonna be the total of over customers. That adds up to 2000 to 95. That, then, is what should be on the trial balance. So there's 2000 to 95 here. So there's our cash receipts journal. one of that, one of the more complex journals to put in place when we have transactions that are separate or different than just a normal sales or accounts receivable type of transactions , such as needing these other type of categories. 11. 100 Worksheet Cash Payment Journal: in this presentation, we will take a look at transactions related to the cash payment journal. We're going to see the transactions on the left side. We're gonna record those toothy cash payment journal. We will. Then at the end of the month, sum up all this activity and record that with one journal entry into the general journal. We will then post that to the General Ledger and that will be used to create the trial balance. We are using a cash payment journal that typically will be used if we have more of a manual system in which we're putting this information into this system on a manual basis rather than a computerized basis. Although it is good to know this for a computerized system as well, For one reason, because the computerized system will often be used to make a cash payment journal or generate a cash payment journal. It's also good to know different types of systems in order to see what the differences are . And what is the similarities between different types of accounting systems. The cash payment journal will work best when there's just a few transactions that happened Repetitive Lee, like all of these type of special journals. In the case of a cash payment journal, it might be that we're buying something consistently. In our case, if we're landscaping, maybe landscaping supplies would be something we purchase consistently and therefore something that would work good in a cash payment journal. As we record these transactions throughout a time period, the more confusing the other thing that might be consistent in a cash payment journal. Is the accounts payable? Paying off the accounts payable the more confusing items of the cash payment journal or those other items? Because, of course, there are many, many things that we're gonna make cash payments for or we could make cash payments for So they're not gonna fall into a nice grouping, as does like the sale journal, where every transaction is the same where we basically have a increasing accounts receivable and an increase in revenue or sales. The catch payment journal could be a lot of things we get cash for, other than than the normal things of making payments for something like our supplies or on account type of payments. Newt, that anything that has a cash receipt should go in the cash payment Journal. So even if we're making a purchase of something that we would say, maybe that should go in the purchases journal that purchases journalist typically revert reserved for purchases on account. So something that's going to accounts payable, as opposed to the cash payments journal which will not be anything we have for cash. Then will be something in the cash payment journal when cash is going out. Okay, so our transactions on 75 we're gonna say, purchased a truck for cash. So we're going to say we could put an explanation and the purchase truck, and we're going to say the cash will always be affected. So cash is going down for the 5000 and then we're gonna say, What's the other account now? This is probably not a normal transaction in that it doesn't happen all the time. We don't by trucks every day, so it's not going to go into the like, our normal to which is accounts payable or landscaping. It's gonna go into other. And this time, which will be the 5000. So there's our debit and a credit basically represented in one line item one format. We're not gonna be posting it yet. We will post it informs of a journal entry it then posted to the general lecture at the end of the month worth of data. Then we're gonna have on 78 We have paid cash for gas and oil. So say guess and oil and we're going to say we paid $80. Now we could When we start talking about expenses, we probably don't have an expense broken out each expense here either because that would, that could be a lot of expenses, typically their arm or expense type accounts than any other type of account. We then are gonna put that as well to the other account here and note that these ones that are kind of more unusual or ones that are more confusing in terms of, ah, a test question as well as the ones that are more confusing it practice. So they were going to say 7 15 paid cash for rent equipment needed for a job. So we'll say and equipment in the notes, and we're going to say that it was 1000. Why should what was it? 75? And once again, that's gonna be another probably type of expense. So we're gonna have to put that into other as well. We're gonna be able to know which how to break these out by the explanations. Hopefully, when we break out this other column this other column in terms of our journal entries. So this is going to be the 75 into other. Then we're gonna go 7 16 and that says, paid for a year's worth of general liability insurance. So we're gonna say 1000 and once again, that's not gonna be our norm. It's not gonna be a paying off of accounts payable or landscaping. She's given an example of all the types of things that a cash payment journal could include . If we do have these often these transactions happening often, then we might have a column for some of these expenses that would be more common. But if not, we're gonna put them into other and break them out. Then we're going to say, on 7 22 we had paid L, H and G for purchases in the past on account, and that was for 1 75 So we're going to say 1 70 and let's put the name this time L, H and G, and we're gonna say 1 75 Now, this is gonna be one of our more normal transactions. This what we would expect? Depending on the type of company that we have, we would expect to make this an and now a dollar sign. And this is a transaction we would think would be more common in that we purchase something on account, and now we're paying off the accounts payable here. So that's gonna be one that if we had, ah, long list of transactions this accounts payable, one might be one, depending on the type of company. That would be the norm of a transaction for the payments. If we purchase something for cash and that was the norm for our particular company, then it might be something like landscaping supplies in our case or inventory, that would be the common other account that would be affected. Okay, so then we're gonna say, paid for fuel. This is 7 24 paid for fuel and oil, source of fuel and oil. And that's gonna be for 1 75 and one skin. This is gonna be an expense. So we're gonna put that over here in the other column and break them out as we go 1 75 and then we're gonna say on 7 30 Owner draws out money for personal use. So owner draw And that's gonna be for Was it $500 for the owner Draw 500. And that's gonna be one that's often not normal. It's not gonna be our normal type of transaction as well. So once again, this is going to go into the other. Now, obviously, this example shows a lot of stuff in the other category here to try to break out all those different types of things that can happen. If we were Teoh be most applicable for some type of journal like this, then note that it would be something that probably we actually make cash payments for regularly and most of the cash payments then hopefully would be in one category. In our case, we by the landscaping on account, and then we're paying it off here. But if it was that we pay cash for the landscaping, you would think that a lot of transactions would be here and then we're paying off on account. Now it's good to note that these other types of things that happen, of course, because those are going to be the ones that are gonna be more unusual and therefore more confusing when looking at test questions or when looking at in practice. OK, so we're going to sum this up now, so we'll sum it all up, skip the line and put put the total here. We will, of course, use the some function to sum it up. So we are in our 12 and we're gonna say equals s, um, double click that some function and highlight from the 5000 all the way down to our 11 and enter or tab. We could go back on here and auto fill it all the way across. I'm going to sum him up as we go, so we can just get an idea just to make sure that we are summing everything else. So we're adding this up. Some function highlight the whole column even though there's only one number there because we want to be consistent as we sum up the columns. So we're going to say that one. I'm going to sum up this calm even though there's no numbers there equals the sum and highlight this entire column. And so if there are any changes, of course, then it would be there. If we wanted to use this worksheet in the following month, then it would be applicable. And they were going to sum up the last column, which is gonna be 5000 all the way down to a U 11. And there we have it. So we have the cash here, and then our journal entry for the entire month will be a credit to cash. It will be a debit to accounts payable. And then it'll be some other debit to these accounts which will have to go back and break out individually by using the explanation. So let's do that. Now. I'm gonna double underline. These will highlight these. Go to the home tab, a font group, and we will double underline. So there we have that they're gonna scroll back over were at the end of the month. We're going to say this happened on 7 30 or that's when we're gonna record all of transactions. That did happen during the month of July. So here we have it. We will say then that the cash is going to be a credit. Now the cash is gonna be on a credit. We probably want to put it on the bottom. So, uh, we're gonna try to estimate how many accounts we're gonna have. Here's and just I'm going to say we got oil, gas, rent insurance accounts, payable oil and pride like five when we may have to adjust this. So we're going to say that cash is going to be effective. Gonna be a credit. Here's our journal entry. I'll start with cash. The easiest thing to think about in the journal entry cashes a debit balance. We want to make it go down by doing the opposite thing to it. A credit. I'm gonna copy the cash. We're gonna scroll down. I'm gonna It's going Try to put it on the bottom, but I don't know how many lions it's actually gonna be. This is why in practice we sometimes we could put the credits on top just to format the journal entry, and it might be a better way to do it. Actually, I'm going to do that for now, and we'll note it later, so I'm gonna right click and paste. 123 I'm gonna put it on the credit side here. We could also indem fis by going to this 80 21 home tab alignment and increasing dent or double click on it and quick the space bar three times. And we're gonna put this in the credit column. So we'll put the credit on top just so we can match it here to what we have in our worksheet. And so we're going to say, instead of equals, we're gonna say Negative, I'm gonna do this with a formula in a F 21. Pointed to that 7000 and five and enter. That'll pull over the 7000 and five. We could do that by just happen in negative or 12. Then we're gonna scroll back over. We're going to take the next one. That's gonna be the accounts payable. So the accounts payable it's gonna be a debit. And if we look at accounts payable, we're going to say, Here it is. It's a credit balance account. We're gonna do the opposite thing to it. A deputed to make it go down makes sense because what we owe is going down because we paid it with cash. So, in other words, we're saying that here's the cash that's being included in terms of a credit going down. We already have that side, including this. That includes this 1 75 And now we're gonna put the other component into it. And that's gonna be the accounts payable. Gonna make an adjustment as well. Here. That's fuel And oil should be 45. So it should be. This are 40 right here. It should be this 40. So I'm gonna change that. That 40. Let's go back over here. Gonna change this 1 to 40. So the fuel and oil should be 40 in both cash and in the other debit account here. Okay, so we'll pull over accounts payable into our transaction. So we need the next account to be accounts payable. Here it is. Accounts payable. I, uh, a high 13. Right click and copy. We're gonna put that underneath in a D 22 right click and paste. 123 Then we just need to pull over the dollar amount, going to scroll back over. That will come from our worksheet. It's gonna be this 1 75 So in e 22 we're gonna say equals point to that 1 75 and enter. So there we have that. Then we have the last component being the other. We can't just pull in that total number, however, because we have to break it out into each of the accounts, so we'll start with this. 5000. We got a purchase of a truck now. Of course, the purchase. The payments here in cash is already there. We need to record the other side of it. That's a credit. This is gonna be a debit. If we purchased the truck, we might put into some type of, um, acid account. How about auto account that we will didn't appreciate over time. So this has a debit balance. We need to make it to go up by doing the same thing to it. Another debit. So we'll copy the auto, we'll scroll down, we're gonna put that in a D 23 right click and paste. 123 Then we're gonna put the debit amount, and that's gonna be equal to this. 5000 will do that with a formula. Were in e 23 equals scrolling up a bit pointing to that 5000 and enter. So there we have that 5000 here. We'll see what else we need. We've got this 80. That's gonna be the gasoline and oil. So gasoline and oil sounds like an expense. If we scroll back over here and look at her trial balance and see what what we have, where we can put that we see that we have auto expenses. That looks like a reasonable place for the gas and oil. So we're gonna put that to the auto expense. I'm gonna right. Click and copy ought to. Expense will put that in a D 24. Right Click and paste. 123 Gonna scroll back over and pull the number in. So here's the amount. Is that 75 Scroll back down. It's gonna be the debit in 80 24 we will say equals and grew up in point to that 75 enter. So there is that right click we're gonna highlight that has been placed. Then we have the insurance. So insurance say we want to put that now insurance. It's a little tricky. Remember, it's not typically going to go to insurance expense when we buy it, we typically put it into prepaid insurance because we have not yet used it. Still, prepaid insurance is well where we will put this. I'm gonna copy this right click and copy A I ate scroll down and we're gonna put that in a D 25 right click and paste. 123 Then we're gonna put the amount in E 25 and that's gonna be this 1000. So we'll do that with a formula in 80 25 equals scroll up just a bit, too. That 1000 and enter so that we have that there's the 1000. So we've done that one. Then we've got the fuel in oil, fuel and oil. Now, we already saw that before we saw gas and oil before fuelling and will probably going to go to the same area. It is the same thing here, so we could add another line item called auto expense. Or we could just add that to this auto expense here, which would be easier, because it'll save us some time to post it. So I'm gonna double click on this. I'm gonna say, plus, and then we'll add to it. That 40. So it's gonna be that 75 plus the 40 or the 115 that's going that's gonna be this 40 here. And then we've got the draws. So draws. If we look at the trial balance, where's droves? It's gonna be in the capital area. So it's gonna be the capital account of draws. And we're gonna copy that. Right? Click and copy has a debit balance. It always goes up in the depth direction, and we'll pace that here, pasting it. 123 Now we just need to put that dollar amount here in e 26 when it scroll back up. There it is. There's 5000. We want to put it in 80 26. We will do that with the formula. Saying equals scroll Back up. Click on that. 5000 are 500 enter and there we have it. So we should be in balance after highlight These we have 7 6090 It's a little off here. We get $80 off. Let's see where that problem is and the problem is here. So I picked up Thea Looks like picked up the wrong number for auto expense picked up the 75 when we should have picked I should have picked up of the 80 eso. I'm gonna adjust that formula, so we're gonna just that. And that's, of course, the benefit of reconcile in here so that we're out of balance. That's the double entry accounting system at work. So I'm gonna double click on this item E 24 double click on it, and it shows a U six and u nine If we scroll up, we see you six is here and United's here. You six is picking up the rent equipment, and it should be picking up gas and oil. So I'm gonna take that you six. I'm gonna delete it and say that we want I can delete it totally up here and then just point to the gas and oil and enter. So there we have three auto. Now, if that was confusing, we can also just delete this and just redo the entire thing and just say equals and we're gonna look for those two cells that have the auto and that's gonna be the gas and oil here . The 80 plus the 40 and enter Okay. There's one other thing we are missing here, and that is the rent equipment. We need to add the rent equipment. So we're off by 75. Or we should be. If I highlight this, $75 off we go to our account, then we're looking for rent equipment. It's probably gonna be some type of expense. So if we go equipment rental equipment rental, like an all expenses have a debit balance, we're going to the same thing to it, increasing it in the debit direction with a debit, so we'll copy that. Gonna put that down here in 80 27. Right? Click and paste. 123 Gonna scroll back over and we're picking up. Then we need to pick up that 75. So we are here in a 27 we will say equals and scroll up. And we want to pick up that 75 enter. And that should do it. If we highlight everything now, it adds up to zero. Meaning debits minus the credits equals zero. If we highlight this, it adds up to 6008. 70 equaling the credits. Now, note that we have this credit on top, and that's not necessarily the normal. We could move that to the bottom or we could keep it there. If it's a manual journalist her because it does coincide with the order of operations we had here. The only thing that really does not coincide with the order of operations is that we put this at the bottom of her. I did this time and we could move that up if we wanted to help ourselves, to look back at it at a later time, to kind of match out what happened up here a bit more easily. But I think it's OK for now. So we're actually gonna leave it that way. At this point, you could again if you want to format it nicely. If you saw this in a computer system, it would typically take the credit and move it to the bottom, depending on the system that we're using. But it doesn't matter for recording things, so we're gonna post this out now Here's our transaction will post this to the General Ledger. We've now put the entire month's worth of information into the general journal. So here's the cash count that we need post Here's the cash on the trial balance. It's the first account there. Then it will be the first account as well. On the general ledger, here's the cash account. We are in the credit side. We want to pick up that 6870. So we're going to be in a M 10. We will say equals scroll down just a bit. Point to that 6870 enter. And that takes the balance down from 12,003. 85 by 6000 8 72 5005 15 That then found on the trial balance as well. Scrolling back down. We now need to pick up the accounts payable. Here it is on the journal entry. Here's the accounts payable on the trial balance. We need to find that on the general ledger. So we've Kathy assets first and then liabilities. So here are the liabilities. Here's accounts payable. We want to be on the debit side, accounts payable Debit side were in. So 80 22 80 22 we're going to say equals that I'm gonna scroll to the left, scrolling to the left and there is that 1 75 We want to pick up and enter. Now, if you want to just type in 1 75 you could. But I highly recommend using formulas you could also use. Just type in equals a E 22. And I will bring the balance to 9 1065 That then also found on the trial balance. Next piece that we need Post is gonna be the autos of the 5000 in the auto. Here's the auto on the journal tree. Here it is, on the trial balance. If we scroll over, we're looking for auto. So here's the auto. It's going to be a debit that we need to the auto that right? We need a Deb. Yeah, we're gonna need attempted to the auto eso We are in a p 15 ap 15. We're gonna do this with a formula again, equals scrolling, left scrolling back down, and we're gonna pick up that auto. So there's the 5000 here in the auto will say enter and that will pick the balance up from 0 to 5000. Once again, you could type in the 5000 here or type in equals 80 23 should pick that up. That number also found then on the trial balance, scrolling back down. We then have the auto expense auto expenses here on the journal entry Auto expense is ah, here on the trial balance. We need to find that same location on the general ledger. So we're gonna scroll where its assets liabilities, equity income and then expense. So here's the assets. There's the liabilities. There's equity than revenue and expenses were looking for the auto. So there's auto in B F 15. So we are in B F 15 we're gonna do that's where they formula. So we'll say equals. We will scroll left until we find this information once again, and then we're gonna scroll down and we want this auto expense of the 1 20 enter. So there it is. There's the 1 20 for the auto expense when a scroll back over to the trial balance and there's the 1 20 in auto expense. Next, Adam, we're going to say is prepaid insurance. Prepaid insurance is here on the journal entry. Prepaid insurance is here on the trial balance, so we will find the prepaid insurance. It's gonna be this account here, it's gonna be on the debit side. So we're in a P 9 89 prepaid insurance debit, we will say equals scrolling left and then scrolling down. We're looking for the prepaid insurance. There's the 1000 prepaid insurance and enter. So that increases the prepaid insurance here on and no, we also could just type in the 1000. But I recommend a formula, or you could type in equals 80 25. And that 1000 also found on the trial balance. Next item we're gonna scroll down. We're gonna keep posting this out. We got the draws. So draws 500. That account is here on the journal entry. It's here on the trial balance. It's gonna be in the same location of the General Ledger assets liabilities than equity. So we have the assets, we have the liabilities and then we have equity. So we're looking for draws were in the draws account the debit side. And here is the cell. It's in BB 16 b b 16. We will say equals and we'll scroll left and then we'll scroll down looking for the draws. That 500 there, and that's an E 26 enter. So there we have the draws. So there's the 500. You could type it in there or you can put in equals ae 26. And that should pull over the draws 500 now appearing that 500 also being on the trial balance. Last one should put us in balance, were off by that 75. Now we're off by this 75. And so we're going to say the equipment will be that last piece of equipment rental. And that's gonna be this Adam here equipment rental. So it's all the way in the bottom of the try. Bounce, assets, liabilities, equity revenue and expense is gonna be the same place on the general ledger. So we've got the assets and green liabilities and orange equity in the light blue and then revenue and expenses. And we are looking for the equipment rental, which is B J one B. J. Nine. So here it is. We're an equipment rental debit side, and we're going to say equals we're gonna do a formula here, equals scrolling all the way to the left, scrolling back down. We're looking for that 75 and enter. So there's the 75 year equipment rental. Here's the 75 there. We will also see it on the trial balance. If we scroll back over and scroll back down, there's the equipment rental that should put us back in balance. We've got the zeros back in balance here, so we're back in balance on the trial balance. Here's the effect on the Net income from these transactions, and that's gonna be it for the purchase or the cash payment journal. Cash payment journal. Everything with a payment. If we're paying cash, remember, that's when it will be in the Cash payments Journal.